Deposit from HB clients

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    Deposit from HB clients

    First time I have had a HB tenant and have a query over deposits. I would generally ask for 1 months rent in advance plus 1 month rent + £100 as deposit. I imagine this will prove difficult for the tenant to come up with.

    Anyone come up against this before and if so did you find a reasonable solution?

    #2
    Originally posted by Rebecca12 View Post
    First time I have had a HB tenant and have a query over deposits. I would generally ask for 1 months rent in advance plus 1 month rent + £100 as deposit. I imagine this will prove difficult for the tenant to come up with.

    Anyone come up against this before and if so did you find a reasonable solution?
    There are several Tenant Rent Guarantee insurance schemes. Try LZ Search facility.
    JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
    1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
    2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
    3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
    4. *- Contact info: click on my name (blue-highlight link).

    Comment


      #3
      Thanks Jeffrey - I may suggest this to the LL.

      Comment


        #4
        Thanks Wickerman. I'm treading very warily into the HB area. We won't be managing this property - its a let only but need to make sure we at least set things off as well as possible.

        Comment


          #5
          Hmmm its a bit complicated this one. LL has only let out once before, a bit of a botch job first time round, no proper agreement in place, didn't bother with references etc. but luckily his tenants didn't prove a problem. His friend decided to do the same but was not so lucky. His beautiful new flat turned into a brothel full of illegal imigrants!

          So he's decided to try things differently this time and has asked for our help. He's found a tenant - a friend of a friend who's on HB. I told him I wouldn't get involved unless he was prepared to have full ref. checks, signed inventories, lease etc.

          Can you see any drawback in Let only?

          Comment


            #6
            Rebecca: you are in Scotland. Is the property too? Remember that most LZ members deal only with E&W, where the law is usually different.
            JEFFREY SHAW, solicitor [and Topic Expert], Nether Edge Law*
            1. Public advice is believed accurate, but I accept no legal responsibility except to direct-paying private clients.
            2. Telephone advice: see http://www.landlordzone.co.uk/forums/showthread.php?t=34638.
            3. For paid advice about conveyancing/leaseholds/L&T, contact me* and become a private client.
            4. *- Contact info: click on my name (blue-highlight link).

            Comment


              #7
              A lot of councils now offer a deposit bond for clients claiming HB. Generally only offered to those with families but some councils do offer them to singles as well!

              Comment


                #8
                Thanks. I'm interested to know why Wickerman thinks our liabilities would be higher if we do a let only.

                The LL knows the tenant (no guarantee of anything) but if we do proper checks, a decent tenancy agreement, get the Standing orders in place, a photographic inventory and secure the deposit on his behalf I'm not sure we can do any more to try and ensure he is protected.

                Comment


                  #9
                  I have let to HB tenants many many times so if it is your first time with someone on benefits make sure they pay their own deposit and first months rent (sometimes the council will advance the 1st month rent to the tenant) and get a guarantor. Make it clear the rent has to be paid on the date due.

                  I sometimes use the council deposit bond but dont like to because it has more risk, Also my council want 3 quotes for any claim and it doesnt cover rent arreas at the end of the tenancy.

                  Comment

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