Help Please I do not know what to do here!!

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  • Help Please I do not know what to do here!!

    I am agent for a LL with a small flat. £425 pm
    The prospective T is 16 years old.
    T's Dad is self employed and will stand as Guarantor.
    T is claiming housing benefit, which has been told is £305 PM.
    T's Dad has offered to pay 6 months of the difference (425-305=120) in advance £720.
    1 Months Deposit £425 and 1 month in Advance £425.
    So as long as T get's the HB paid. i am happy the rent will be paid.

    My question is really about the tenancy.
    T can't claim housing benefit unless has a signed AST and T is <16 and can't sign an AST. So if I sign T's Dad up as the Tenant and Grant T a right of occupancy, this would cover me would it?

    Also, would I be in breach of anything if I drew up AST to say the rent was £305 in order for the T to apply for HB? but in reality the real T agreement was with the Dad.

    Any advice would be welcome as I dont really want to stuff it up!
    Thanks for your help.

  • #2
    I'm sorry, I don't know the answers to your questions, but this thread may help:


    http://www.landlordzone.co.uk/forums...ad.php?t=27081
    'Pause you who read this, and think for a moment of the long chain of iron or gold, of thorns or flowers, that would never have bound you, but for the formation fo the first link on one memorable day'. Charles Dickens, Great Expectations

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    • #3
      Originally posted by Jimbotron View Post
      My question is really about the tenancy.
      T can't claim housing benefit unless has a signed AST and T is <16 and can't sign an AST. So if I sign T's Dad up as the Tenant and Grant T a right of occupancy, this would cover me would it?
      Once you have read the other thread mentioned by MTG you will need to decide whether the landlord wants to:

      a) attempt to grant an equitable tenancy to the minor
      b) purport to grant a legal tenancy which will have the effect of creating a Trust, with the tenancy being held by the landlord for the minor until he or she is 18. This may or may not be combined with (a) above.
      c) grant a licence to the minor
      d) grant a tenancy to the parent so that he can allow his child to reside. As the father will not be resident, it cannot be an AST but would, rather, be a simple contractual tenancy.

      Originally posted by Jimbotron View Post
      Also, would I be in breach of anything if I drew up AST to say the rent was £305 in order for the T to apply for HB? but in reality the real T agreement was with the Dad.
      You would be commiting fraud, if I understand your suggestion correctly.

      With regard to my earlier options, the minor could claim HB in all four scenarios, but (d) in particular would require some very careful negotiation with the local authority with the objective of persuading them to exercise their discretion to allow benefit to be paid to person a who is not strictly liable for the rent. The latter power is more generally exercised in the context of a relationship where one party is a claimant whilst the other is the tenant, but it could be used in the present circumstances also.

      Indeed, it would be sensible for the authority to at least consider it, because if the minor can be found settled accommodation without involvement from the statutory authorities, there is a huge potential saving for them.

      I would suggest, though, that this is a situation in which some specific advice from an experienced lawyer would be helpful, particularly in relation to the drafting of the relevant occupancy agreement, whichever option you choose.

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