Getting LHA payments direct, is it really happy ever after?

Over the past few years there has been an endless amount of articles written on the importance of securing direct payments from local councils. If you attend property conventions, forums or seminars you are often lead to believe that direct payment is the central key to minimising your risk with LHA tenants. So much so that there now seems to be a growing culture of misconception within the industry for those who are new to property investment or to dealing with housing benefits as direct payment is portrayed as the holy grail of LHA. But is this really the case? Or is there more to it?


Securing an LHA tenant – The increasingly stereotypical route

Open up the property section of your local newspaper or search through an online portal today and you will see that more and more letting agents are offering their properties to LHA tenants with enticing offers such as NO BOND REQUIRED or MOVE IN FOR FREE. These offers are prime examples of a business model which is based on securing tenants quickly by removing as many barriers as possible that would otherwise usually prevent them from being able to secure a property. Aside from the monetary factors unfortunately for landlords the other barriers tend to relate to vetting procedures which more often than not are relaxed or none existent. This typically results in tenants being secured solely on their ability to qualify for direct payments rather than on their previous rental history and individual merit.

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