Guarantor becoming tenant and tenant becoming permitted occupier..?

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    Guarantor becoming tenant and tenant becoming permitted occupier..?

    All help gratefully received....its a bit twisty turny!

    My dad is on housing benefit as a retired pensioner who lost everything in a messy divorce in 2001.
    My husband acts as his guarantor on his current rental in Wiltshire but we want to move him to Worthing to be nearer to us and his grandchildren.
    We have found a flat and initially the lettings agency were happy for my husband to be the guarantor and commenced checks accordingly. Then it turned out that my dad has two ccj's outstanding against his name. (He didn't even realise they were live and they didn't come up in his previous check 18months ago)

    They now want to make my husband the "tenant" and my dad the "permitted occupier" on the TA, so the landlord won't lose his insurances as a result of letting the flat out to someone with ccjs over £3k in their name.

    My husband will pass the tenancy check so that shouldn't be a problem, and my dad will claim housing benefit on the basis that he has to pay rent as though he were a tenant.

    Will the tenant status against my husband's name have any knock affects for anything else in his life? Especially as there is no circumstance under which he will actually be a tenant in any true sense of the word...? (i.e He wont be paying the rent and he wont be living there! That part sounds like such a fiddle to me!)

    Incidentally - they have already had £300.00 off us to arrive at this point and want a further £75.00 to perform the tenancy check.

    They are a reputable local firm who manage a number of properties for investment landlords in the area but my dad has to move in two weeks, they know this and I cant help feeling that there is something funny going on....

    Like I say - all help gratefully received!

    #2
    This agency doesn't appear to know what it's doing. Your dad cannot be the quasi tenant on an AST as it wouldn't be his main residence. It's all very messy and the agency doesn't appear to be conducting itself very well on behalf of the landlord.

    The council won't be too pleased either as it is clearly a fraudulent claim, despite what you might think.
    The advice I give should not be construed as a definitive answer, and is without prejudice or liability. You are advised to consult a specialist solicitor or other person of equal legal standing.

    Comment


      #3
      To be honest I have never heard of a landlords insurance being affected by the totaling amount of ccjs amounting against a tenants name.....though I do not have any tenants in the same position as your Dad.

      The only potential issue that could be a factor is if the landlord has changed his mortgage product and this does not allow fr rental to housing clients.

      Either way your husband should not sign as the tenant.

      Housing benefits will most likely not pay your fathers full entitlement as your husband is down as the tenant they will want to know his income prior to processing a claim... you could very well end up being responsible for the full rent depandant on your earnings.....

      personally I would make contact with the letting agent and suggest that if insurance is the key issue with this let then it would be wise to consider them looking for another insurance company. plus I am quite sure that if this was a dciding factor withthe insurance company such insurance would be invalid if it was discovered your husband did not reside there!!

      Ask for a writen explanation from them as to the situation

      Comment


        #4
        Thanks so much for the input - I like the idea of asking for all of it in writing.

        The sticking point is that I am already £300.00 down as I will lose all of that and the results of the checks so far if I walk away (not to mention having nowhere for dad to live with only a fortnight until he moves)

        Are we basically saying that my husband should not agree to be named as the tenant if he does not intend to live there, and furthermore, even if he was to agree, my dad cannot be his permitted occupier and live there on his behalf and pay the rent with housing benefit accordingly...?

        Why are they telling me the landlord will lose his insurance if he rents to someone with a ccj if its not true - they must expect me to check...? Has anyone ever heard of a landlord losing out a result of consciously renting to someone with a ccj even if that person has guarantors?

        Thanks again for any further advice - it will all help when I have to go head to head with these people at midday tomorrow!

        What a brilliant forum!

        Comment


          #5
          a landlords insurance wont be affected by any ccjs amounting against a tenants name

          Comment


            #6
            are these letting agents for real

            Comment


              #7
              No I've never heard of anyone losing out on the insurance ......

              there could be a whole host of reasoning behind it stretching from poor agent communication to the landlord changing his mind on or not accepting housing benefit - which would explain why they want your husband to be the tenant - but without having the facts ths is just speculation.

              perhaps it would be a good idea to call a couple of insurance companies and ask them if there would be an issue? As I said its never been an issue but its also never been asked when taking details for a policy.

              regarding your fees - I would assume you have signed to say that should the references fail for undisclosed information then you are unfortunately liable for the charges...

              Comment


                #8
                What was the fee for?

                Comment


                  #9
                  Hello all - and thanks again for the further input

                  The fee was the security deposit to secure the property for us and they used £117.50 to check out my dad which revealed the ccjs, and £117.50 to check out my husband as guarantor, which he passed. We will have to come up with one month's rent for a deposit and a month in advance, on top of this if dad does end up being able to move in.

                  They are saying the £75.00 to check my husband out as a "tenant" requires different "referencing" and will be in addition to the above.

                  They do seem legitimate, in that they have lots of branches and lots of boards about. I think the theory that the landlord doesn't fancy us is correct and the reasons given are just a bit of blarney. Very disappointing given that we passed the guarantor check AND offered 6 months rent in advance if it helped reassure the landlord we were genuine.

                  I am waiting for the council to call me back with a definite answer on the chances of my dad getting HB as a permitted occupier and will ask for all of this in writing but I think I have just been really unlucky in trusting my dad to fill out the forms right and managing to kick this all off with really expensive letting agents. (They also don't seem to give a monkeys that he has been a good tenant in his current property for 18months and has got glowing references and never once been late with his rent. Silly me for thinking that would count for something!)

                  I am still really worried about my husband being named as the tenant on the agreement when he will not be living there or paying the rent, but I can sort of see why they would prefer him on the agreement to my dad. (Although surely it makes no real difference in that if my dad defaults as a permitted occupier they will have to get the money from us the same way they would have done if we were guarantors and he was the tenant...?)

                  I am also totally cheesed off at the expense thus far but they have got me over a huge barrel as I am now terrified of starting this process with another agent and finding myself in a similar position (although they do seem to be primarily profiting from the fact that we unwittingly did not reveal the ccjs before they found them. I wouldn't let that happen again)

                  Upshot so far is I feel better equipped to ask for more info and to ask for it in writing before we proceed. They have very "kindly" given me until tomorrow lunch time to decide if I want to pay the extra £75.00 and proceed on their terms or walk away and lose the lot. Also a bit rich given that it has taken them two weeks to draw these conclusions....

                  Thanks again for all the input - a problem shared and all that...:-)

                  Comment


                    #10
                    you'd be surprised at how many people have ccjs and dont know about them..... however as agents the majority of us take a guarantor to protect our landlords when the tenant has poor credit.

                    If your agent is a corporate agent there is a head office to follow a complaints produre over poor communication on the agents behalf and 9 times out of 10 they will order a refund as they do not want a blemish upon their reputation.

                    Best advise for today is ask for a complete explanation of what they intend to do... ask how this will work..... ask them to call the council and tell them what they intend to do re the agreement.... ask them how they will be altering the tenancy agreement to accomodate for the fact that your husband will not be living at the property.....when a tenancy agreement has clauses pertaining to occupation.... other benefits:council tax will they pay your fathers ct? its unlikely and by having 2 people "living" in the property it makes 100% payable

                    If you cant decide how to reply go away have a coffee review your notes and have a good think before you reply . dont reply if you are not 100% happy

                    Good Luck

                    Comment


                      #11
                      Latest Update...this is just getting stranger and stranger.

                      The council have said they will be happy to pay CT benefit and HB provided the lettings agent will confirm that my husband does not live there and my dad pays the rent.....

                      The letting agents are saying they absolutely WON'T do that!They will put James down as the tenant, my dad down as the permitted occupier and if they are asked they will say my husband is the tenant because that's what the agreement says.

                      I reminded them that the agreement was only in place so the landlord could keep his insurances and we would only be able to pay for the property if they were able to back me up with the HB application and tell the council the reality of the situation and they won't do it......

                      Comment


                        #12
                        Just in case anyone else finds themselves in a similar situation the outcome was this...

                        1) The council said they had no problem with my dad claiming housing benefit on the basis of being a permitted occupier.

                        2) However, despite receiving this good news this morning, the lettings agents decided this process has taken too long and told me they were keeping my £300.00 and not letting us proceed with the application. They admitted they don't have anyone else ready to occupy the property or ready with the holding deposit as we were.

                        Are there any legal eagles out there who would give me some advice on this - happy to pay....

                        Comment


                          #13
                          Originally posted by Smackley View Post
                          Just in case anyone else finds themselves in a similar situation the outcome was this...

                          1) The council said they had no problem with my dad claiming housing benefit on the basis of being a permitted occupier.

                          2) However, despite receiving this good news this morning, the lettings agents decided this process has taken too long and told me they were keeping my £300.00 and not letting us proceed with the application. They admitted they don't have anyone else ready to occupy the property or ready with the holding deposit as we were.

                          Are there any legal eagles out there who would give me some advice on this - happy to pay....
                          The agency cannot just keep your £300 as it is a penalty and therefore contrary to guidance in the UTCCRs 1999. They have got to show how they have calculated this amount; they are allowed to charge "reasonable costs" but you must have been given information on this in writing before you entered into any negotiations to rent, and there should be a maximum shown.

                          Have a look at Page 12 on this http://www.oft.gov.uk/shared_oft/rep...rms/oft607.pdf

                          The rest of the document makes interesting reading too.
                          The advice I give should not be construed as a definitive answer, and is without prejudice or liability. You are advised to consult a specialist solicitor or other person of equal legal standing.

                          Comment


                            #14
                            Thank you so much Paul F - this has been very useful.

                            So far they are are still telling me that they won't budge but I can give them another £300.00 to go through the process again if I still want the flat for dad...... If they are prepared to take £300.00 off a pensioner on benefits two weeks before he is supposed to be moving then funnily enough I don't think I will give them any more money!

                            Obviously I am not much use at tenancy and landlord stuff but if I can ever do anything to be of help to you, I'd be glad to. Thanks again - much appreciated.

                            Comment


                              #15
                              Do you have a receipt from the agency showing that you paid them £300?

                              When you paid the £300, did they say what this was for? Do you have anything in writing saying what it was for?

                              Paul f's comments are jumping the gun slightly. There may not even be a contract in place between you and the agency.

                              Comment

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