Universal Credit The Elephant in the Room

No but I'm sure that after Paul's comments she will be able to pick him out haha

Watch out Paul Interflora might save your bacon.

In slight defence of Paul's position Although I would say most LHA claimants do not come with extra support needs, most people with high support needs tend to be on benefit, which is not the same thing. Althoguh it is inacurate and condescening to presume the 2 go together it is an understandable human trait to generalise personal experience. Its how we learn and protect ourselves.

In that, I understand that Paul is using his experience to help him run his affairs, its what we all do.

Most landlords go on references and gut instincts when choosing a tenant and I htink that is as it should be, even if those gut instincts are wrong sometimes. I think the new Experian service for tenants and landlords is a great idea. A person might have a crap credit score overall but never miss a day's rent payment, which is all that matters to a landlord anyway. I hope that any tenants wanting to avail themselves of this new service realise that it cuts both ways though.

I too have a crap credit rating and have to suffer the ignominy and embrassment of having a guarantor and yet i work, earn a good wage and earn extra through writing, training and a bit of consultancy but my sole trader housing law training business took a hit in the recesion (training budgets are always the first to get cut in public services) and I went bankrupt. Many millionaires go bankrupt several times in their life so I'm in good company. On paper this makes me high risk but as a tenant I'm never even a day late with rent.

I like to think that alandlord would look at me and use their gut, not my credit score. Mind you.....what kind of triple idiot would take on a tenant whose job is to prosecute landlords? hahaha

I think the big issue with things like credit ratings etc; it is very much a question of 'the computer says noooo!'
Credit scores do not represent the true status of nhe ability of the tenant to pay rent.
Credit scoring is mostly made up of past performance history.
As you correctly say how can past performance be a judge of future performance.
Isn't that what the FSA insists all financial firms put at the bottom of their adverts.
I would say as a LL the ONLY history I am interesed in is the rent history.
This is all that should concern RGI companies.
Whether someone went bankrupt; didn't pay a credit crd bill on time or defaulted is totally irrelevant.
All a RGI company anf LL really need to know is fid they pay their rent on time.
If so we will cover them.
If this worked and becsame widly known evry tenant would pay yheir rent as would know it would greatly assist in a new tenancy; and to hell with a stupid bankruptcy or defaulted credit card!!!

Well there is the other side, and this is relevant for UC too. Financial education. If tenants sign up for the new Experian thing then the fact that they dont pay rent late helps rebuild knackered credit scores. So do several pay up front debit cards recommended on Martin Lewis's Money Saving Expert website, but as with Experian they only work if you keep up payments, if you start missing they work the other way and in the rent case they'll make landlords more reluctant to let.

I meet many tenants, working and otherwise, who get into disputes with thelir landlord and ask me if they can withold rent. Of course legally they can if the circumstances are right, but I always advise caution because they have to take on board that any new landlord will want to talk to the old landlord. And yet so few consider this.

In that way direct payments could help tenants and could help landlords make better decisions. I wouldnt risk signing up to experian if payments were going direct to landlords from HB because if they screw up, as they often will do, it is the tenant credit reputation on the liine. At least with tenant payments, if they dont keep up to date you know you cant blame HB.

I have a mortgage case at the moment that I saved from repossession by getting the case suspended on terms that she could afford payments which were being stcked up by receiving a thing called Support for Mortgage Interest (SMI) from the DWP. All was hunky dory until the DWP strated to adjust their assessment and varied the rate of SMI they were paying. A few months at the set rate then a couple at a lower rate, then back to set etc. I have no idea why they decided to do it that way but it blew the deal we had arranged out of the water and now the poor woman is facing repossession precisely because she didnt have control over her income.

Paul I learn from other landlords all the time and I am always interested in their business model.

I have not used RGI and I have no idea what a landlord needs to do to get it.  You are representative of many landlords who, far from the stereotype, are not stinking rich and rely on their rental income to live. I am certain that I am not the only landlord who does not know how to get this type of cover or indeed which companies offer it.  Will you please post a step by step guide to how a landlord obtains RGI, inlcuding the information we need to capture about the tenant please. I will add your guide to my seminars so that landlords, who are prepared to pay a premium, will know how to safeguard their rent.

Its a good point Ben but makes a case for UC and payment to tenants - Surely you are not agreeing with Government Ben???? hahahaha

Actually for many reasons, including the points you make, UC makes sense but as you and I know that it must be coupled with education and perhaps some interim support like payments into banks or CU rather than Post Offices so that D/D and S/O can be set up to pay their bills automatically.  Actually it has just occured to me that Government should invest a few pounds and some publicity in CU's to give tenants information about location of offices and how to set up an account.  If my bills were not all paid automatically I might own more shoes, there are very few people who actually "manage" their own bills these days and bringing tenants back into the norms is going to help us all - many people are surprised that Credit Unions still exist. 

I have just read this http://www.thisismoney.co.uk/money/bills/article-2120048/Energy-bills-soar-70-cent-average-2-200-year-2020-says-Liberum.html?ITO=1490

Energy bills set to soar by 70% by 2020.  This too will have an impact on the tenants ability to pay their rent.  Utility bills need to be part of the D/D S/O regime too.

Recently landlords have been saying that for the first time students are turning off the heating and they are having to deal with mould because of this.  We will have additional costs if tenants reduce the heating to control their bills and cause mould when they do not open windows

Agree with the government???? Yeah I've kind of come apart on that one a bit havent I LOL.

Its not that this old Trotskyist is donning a blue tie, its just the Buddhist in me. We are very hot on self responsibility. We dont believe in god or the fates so we cant blame anyone else for anything.

I suppose I dont disagree with the concept of UC in that sense, I just dont believe that they will get their stated result by cutting the amount people will receive and just dumping the money in their laps. Its effectively like a working person getting a pay cut. In those circumstances I am not convinced that even the well disciplined or the financially savvy will be able to cope. You cant make an inch stretch to a yard no matter how good you are with money.

Credit unions are the great hidden resource in here and need promoting more. They are also sound business models in that unlike normal banks the money invested by the community stays in the community. How's that for a nice bit of old fashioned Socialist logic that works????

Also I can see an incrreasing role for social landlords investing in properties to go PRS, and REITS too. The landscape is changing....has to change to adapt and I think the lines will be blurring between landlords, the laws and regulations, how public and private do business and hopefully how tenants see their place in all this.

Like all times of great change they can be very worrying but also quite exciting and I also think that those who have the requisite vision and flexibility will be in the vanguard of  what is coming.

Damn this sunshine brings out the optimist in me

Mary

Within a month the most competitive package for tenant and guarantor referencing and rental guarantee insurance will be available to purchase on this site. Underwriting and policy issue will be instantaneous. Cover will be underwritten by DAS. The best comparable package on the Market now costs £95 and rakes days to underwrite. Ours will be quicker and cheaper with the same insurance company backing.

Thats great news Mark and I know you said within a month but you KNOW I've no patience so will you give me an idea how RGI works in principle please.  As you know finding solutions for landlords is what its all about for me and many landlords share Pauls concerns I would like to give them the "how to" at my seminars - they can then choose the supplier for themselves of course and if the P118 product is going to be that competitive it should be very popular.

I love it when you talk optimistically Ben.

On a serious note if you can see the possibilities in UC I truely believe that it has a chance of working.  I agree that money cannot be stretched further than it will go but that is also true of the "public purse" and there is no question that we cannot simply allow the benefits bill to increase year on year.  I have given a lot of thought to what I would do if I was running this country and I cannot find a better solution than UC.  I am not interested in party politics but I am a tax payer and I intend to live in this country for the rest of my life and I want it to be a good place for good people to live.

As you know Ben one of your neighbouring authorities has already announced that priority will be given to people on their council homes waiting list who are in work.  This makes me cross on one hand because those publicly owned properties were meant to house those in most need.  On the other hand this authority is making the same decision that many private landlords are making - target those who are more able to pay in order to avoid bankruptcy.

Are they also saying that those in work are more LIKELY to pay than those on benefits?