DSS Over-payments – Readers Advice Request

I agree about a home owner guarantor but only if you obtain a RGI policy on the guarantor.
Even if you are a homeowner, equity and employment can change rendering the guarantor worthless.
They can have unsecured debt charged against the home legal title using up any equity.
No chance of recovery via county court etc.
RGI on a guarantor yes, otherwise worse than useless.

The RLA works extremely hard to ensure that the advice our Helpdesk provides is accurate and practical, and can be trusted by the RLA membership. Therefore, we are extremely perturbed by
the scenario outlined above, and have undertaken a thorough, internal investigation. The RLA records all its Helpdesk telephone calls, and having undertaken an audit of our phone system, we have found no record of a phone call in which we advised the caller to ‘insist’ upon full payment by the LHA for the entirety of the 12-month tenancy agreement, based on this scenario.

However, the RLA can confirm that in a similar case recently, our Helpdesk stated it was “worth a try”, as an “initial” approach to a local authority, to inform the local authority that the tenant had signed a 12-month tenancy agreement. It was also clearly stated that it would be, “…interesting to see what their [the local authority’s] response would be.”

No mention was made of overpayments by the member in this case, and no further advice was sought by the member at this time.

As with such matters, it would not be unusual for a member to re-contact us for updated advice based on the local authority’s response. In this instance, our member stated, “I will see what happens and I might let you know.” We have not been re-contacted by the member and assume that the matter has now been resolved to their satisfaction.

As such, the RLA stands by the advice given at the time to this caller, based on the facts provided by them. It goes without saying that should the member wish to re-contact us at a later date, to request advice based on an updated situation then we would be only too happy to provide further guidance. Nonetheless, in the first instance, it is extremely important that Helpdesk callers provide us with the fullest details of their circumstances, in order for them to receive the most accurate advice.

In regards to the wider issues outlined in the above scenario, the RLA would advise the following:

1. If a tenant leaves part way through a fixed-term tenancy agreement, the landlord could by law expect the rent paid for the remainder of the term. In those cases where the tenant has not given written notice of leaving, nor given the keys back, the tenancy continues. The RLA would advise the landlord to serve notice on the tenant, apply to court for a possession order and then apply to court again for an eviction warrant. Only when the bailiffs call would the landlord be lawfully handed back possession of the property. Some landlords however choose not to heed this advice because of the time and costs involved. They take a gamble by changing the locks and re-letting. That’s their gamble and not a course we advise because they run the risk of the tenant returning and inevitably the landlord will be charged with unlawful eviction.

2. Turning now to the position under LHA. If the tenant leaves without notice and claims benefits at their new address the local authority will inevitably stop the payments at the old address. If the local authority realises they have paid benefits beyond the date the tenant says they left, then the local authority will reclaim those overpaid benefits. In that case, the landlord could try reasoning with the local authority that the tenancy continued and was therefore entitled to expect the benefit to be paid. This is not however a winning argument for many landlords unless the local authority is a soft touch.

The RLA trusts that this resolves any misunderstanding that may have arisen from the posting above.

This has happened to us twice. In both cases the benefit only covered part of the rent and the tenant was in arrears with the balance. Therefore, we were not profiting overall from the "overpayment". In the first case we tried to use the moral argument knowing legally we could not win. The authority insisted on payment, but before they issued proceedings, we moved house and they stopped pursuing us.

In the second case. we managed eventually to get an attachment of earnings order against the old tenant and we receive £40 a month which we pass on to the authority. After about a year it should all be paid off. Fortunately, the authority have been quite patient.

This is why LL should NEVER accept direct payment unless they are going through the process of evicting the tenant.
The council CANNOT then come to the LL for recovery of ANY overpayment.
They can ask but they won't get.
The council are obliged to try to recover from tenant.
Of course they won't stand a chance or rather they will but at £1 per week for the next 30 years!!!

Personally, we always choose direct payment. Our experience is that just because the tenants have received the housing benefit, it does not mean they will pay the rent.

Clawback is the answer as to why you should not risk direct payment unless you have loads of money to repay the council for a claim possibly going back 6 years.
Too risky for me!!