Universal Credit claims soar in coronavirus crisis – ‘key dates’ for tenants & landlords
The coronavirus (COVID-19) pandemic is not only sadly impacting on the health of hundreds of thousands across the globe, but the crisis is also having a detrimental impact on people financially too. As March 2020 drew to a close, it was revealed that around 950,000 people had claimed Universal Credit in the past fortnight- up from around 100,000 in a normal two-week period, the DWP said.
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The Government department said it is moving 10,000 existing staff members in order to help process the claims.
Following the surge, Caridon Landlord Solutions has warned that it could mean that thousands of private landlords will now need to understand Universal Credit, due to their tenants now needing to claim the payment.
Caridon Landlord Solutions, part of Caridon Group, has said that landlords should educate themselves on the Universal Credit system now, so that they can support their tenants and both mitigate the risk of rental arrears.
Sherrelle Collman, Managing Director of Caridon Landlord Solutions, which specialises in providing advice to private landlords, letting agencies and housing associations on Universal Credit and Housing Benefit, says thousands of landlords who have no previous experience of the benefit system, will now have tenants on Universal Credit.
Ms Collman said: “As the true impact of Coronavirus takes hold, many people who have never previously needed to rely on the welfare system are having to apply for Universal Credit.
“Many will be anxious not only due to the current situation but because of the criticism Universal Credit has received since its introduction.
“The good news is that more resources have been deployed to local authorities to help claimants, and measures such as immediate access to Advance Payments, increases to Universal Credit and raising the Local Housing Allowance rate to the 30th percentile of market rents from April, are being put in place.
“We have had a surge of calls from landlords and letting agents asking advice about how the process works and if they should apply for an Alternative Payment Arrangement for their tenant, which is where the housing element of UC goes straight to the landlord to cover the cost of rent.”
Caridon Landlord Solutions has suggested there are four key steps which landlords can take in order to help support their tenants who may now be applying for Universal Credit.
This includes establishing “key dates” such as the tenant’s Benefit Assessment Period, in order to see how this falls in line with the Tenancy Agreement.
“Communicate with your tenant and support them as much as you possibly can.
“If they are having to apply for Universal Credit, it is most likely because they have lost their job or had a significant drop in income.
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“They will be concerned they could also lose their home.
“Where possible, consider a rent reduction to meet the housing element of Universal Credit, some rent to help cover a mortgage is better than nothing, or if at all possible, offer a rent holiday.”
“If your tenant has had to apply for Universal Credit because of COVID-19, they will require a letter from you verifying the rental amount, the address of the property they reside, and when the tenancy commenced.
“This will help them to qualify for the housing element of Universal Credit which will go towards covering their rent.”
“Work with your tenant to establish key dates, such as the tenant’s Benefit Assessment Period (the date their entitlement begins) so that you can see how it falls in line with the Tenancy Agreement.”
“Many tenants prefer to have the housing element of Universal Credit paid directly to the landlord so they can manage the rest of their finances themselves.
“This is called an Alternative Payment Arrangement. Landlords should discuss this with their tenants and if in agreement, fill out a UC-47 form to apply for this.
“If the tenant is already in arrears, the landlord can also apply for Third Party Deductions to reduce this, where an additional amount is taken monthly from the claimant’s personal allowance.”
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