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Universal Credit – What are the facts & your plans moving forward?

This entry was posted on Thursday, January 3rd, 2019 by Nigel Fitzakerley

I hope you enjoyed our previous articles on Universal Credit which has given you more confidence in accepting Universal Credit tenants.

An interesting fact is that two thirds of landlords are hesitant to accept tenants who are claiming Universal Credit due to them falling into arrears straight away. The percentage of landlords who have experienced arrears due to their tenant being on Universal Credit has risen by 34% since 2016 and this is why at NGU Homelettings we are regularly implementing new processes to try and decrease the number of applicants who fall into arrears. It’s not only a stress for the landlords but also the tenants who struggle to manage this new system.

Research has shown that on average tenants claiming UC that are in rent arrears owe almost £2,400 which is a 49% increase compared to last year!

On average Universal Credit claims can take up to 9 weeks to process which is why tenants are falling into arrears.  This also means landlords aren’t getting the rent payments they need to pay their mortgages.  With the initial process time being effectively 2 months for a tenant it can mean landlords are owed 4 months’ rent before they’re successfully awarded direct payment.

Moving forward!

  1. The residential landlords association (RLA) are pushing for the alternative payment arrangement to be improved as a matter of urgency
  2. The RLA are also calling for tenants to be able to choose whether they want their rent entitlement paid to them or to their landlord directly.
  3. Finally the RLA are calling for landlords/agents to be given more information regarding a tenants claim as at the moment this information is only given to social sector landlords rather than the private sector which is causing many issues.

If you found this article interesting or need assistance in finding a thoroughly vetted tenant especially if they’re on Universal Credit.  Do not hesitate to contact us on: 0191 491 0344 Option 1.

Regards,

Katie Wybrant

 

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