Landlords may have to get used to letting to tenants that are claiming benefits. Many landlords actively opt not to let their property to anyone who is receiving state benefit for fear they may end up in rent arrears.

It is not strictly illegal for landlords to state they do not wish to let to tenants claiming Universal Credit - although it may be found to be discriminatory should a tenant decide to pursue their case in court - and many do exactly that. But those days may now be over. Almost one million people have applied for Universal Credit since the government closed non-essential businesses around the country and urged people to stay at home. This means that most landlords, who have never previously let their property to a tenant who is claiming benefits, now will. So what should landlords who find themselves in this situation do? Caridon Landlord Solutions which specialises in providing advice to private landlords, letting agencies and housing associations on Universal Credit and Housing Benefit, offered this advice in Landlord Today and it may be helpful to take note of it.

• 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. 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 them. This means an additional amount is taken monthly from the claimant’s personal allowance To clarify the rules on this.

Earlier this month, the Department for Work and Pensions (DWP) published updated guidance for landlords with tenants in receipt of Universal Credit. The guide explains what landlords can do to help tenants prepare for their move to the single Universal Credit benefit payment and make rental payments directly to their landlord themselves. It also explains what support is available for tenants who may need help moving to the new system. Click here to read the guide and find out more. Sherrelle Collman, managing director of Caridon Landlord Solutions, says thousands of landlords who have no previous experience of the benefits system, will now have tenants on Universal Credit and many will be anxious because of the criticism it has received since its introduction. However, she adds: “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 from April, are being put in place".