Changes to Housing Benefit for tenants of private landlords from April 2008

 

What is Local Housing Allowance?

The Government has changed the way the Council works out and pays Housing Benefit for some private tenants from April 2008. By ‘private tenant’ we mean somebody who rents their home from a private landlord.

Local Housing Allowance is help with the cost of rent and will take the place of Housing Benefit for some private tenants.  

It is a fixed rate based on the locality of your property and the number of bedrooms you need, not how much the rent is.  

This is the maximum figure that can be used to calculate Local Housing Allowance. The amount of Local Housing Allowance you get will depend upon your income, capital and if you have other adults living with you.

The locality of your property is decided by the independent rent officer

The number of bedrooms you need depends on the number of people who live with you.

The rules say how many bedrooms you and your family need.

You will need one bedroom for:

  • every adult couple
  • any other adult aged 16 or over
  • any two children of the same sex aged under 16
  • any two children regardless of sex aged under 10, or
  • any other child aged under 16

Who is Local Housing Allowance for?

Local Housing Allowance is for private tenants who:

  • Move on or after 7 April 2008
    or
  • Make a new claim for Housing Benefit on or after 7 April 2008

Who cannot get Local Housing Allowance?

You cannot get Local Housing Allowance if:

  • You are a private tenant who is already getting Housing Benefit (unless you move or have a break in your claim, on or after 7 April 2008) as you will continue to get your Housing Benefit
  • You are a council tenant
  • You are a tenant of a housing association
  • You are living in bed and breakfast accommodation
  • You live in a caravan, mobile home or house boat
  • Your tenancy started before 1989; or
  • You live somewhere where you are provided with care, support or supervision

Local Housing Allowance may not apply if your rent includes an amount for meals.  The rent officer will decide if this applies to your rent.

How Local Housing Allowance much will I get?

Your Local Housing Allowance will depend on:

  • The area you live in
  • Who lives with you
  • The number of bedrooms you and your family need; and
  • Any savings or money you may have coming in

The number of bedrooms you need

The rules say how many bedrooms you and your family need. You will need one bedroom for:

  • Every adult couple
  • Any other adult aged 16 or over
  • Any two children of the same sex aged under 16
  • Any two children regardless of their sex aged under 10; or
  • Any other child aged under 16

The area you live in

An independent Rent Officer will split the borough into different areas called Broad Rental Market Areas (BRMAs). Within your Broad Rental Market Area, the amount of Local Housing Allowance will be the same for each household that needs the same number of bedrooms.

Find out which broad rental market area your property is at the Rent Service Website.

The Rent Officer will review the Local Housing Allowance rates and supply the authority with an updated list each month.  

The set rates of Local Housing Allowance will be published each month throughout the Council and on the Council’s website, so customers and landlords will always know what the current rates are.

Amount of Local Housing Allowance

If your rent is less than the Local Housing Allowance, you will be able to keep up to £15 of the extra money. But if your rent is more than the Local Housing Allowance, you will normally have to make up the difference yourself.

Local Housing Allowance is used as the rent figure for working out Housing Benefit. As Housing Benefit is based on your income and family circumstances your entitlement may be less than their Local Housing Allowance.

People under 25

If you are single and under the age of 25 and Local Housing Allowance applies to you, you will only qualify for the Local Housing Allowance rate for shared accommodation regardless of the size of accommodation that you live in.

The rate for shared accommodation is based on the tenant having sole use of a bedroom or bed-sit and shared use of some or all of the facilities for example, a kitchen, living room or bathroom and toilet.

However, this rule will not apply if:

  • you have a partner
  • you are getting Child Benefit  for a child in your care, or
  • you qualify for certain disability benefits

Local Housing Allowance Rates

The amounts of Local Housing Allowance are set by the independent Rent Officer and are reviewed each month. The rates for May 2008 are:

LHA rates for Waltham Forest
Number of Bedrooms Weekly LHA Outer North East London BRMA Weekly LHA Outer East London BRMA
Shared accommodation £85 £85
1 bedroom self contained   £150 £161
2 bedrooms £184.62 £200
3 bedrooms £230 £250
4 bedrooms £313.27 £300
5 bedrooms £415.38 £350

How is Local Housing Allowance paid?

Local Housing Allowance is usually paid to you and not to your landlord.  You cannot choose to have it paid directly to your landlord.  However, in very special cases, we may pay it to your landlord, for example if you owe at least eight weeks rent.

Opening a bank or building society account

The easiest way is receive your Local Housing Allowance is to have it paid into a bank or building society account. If you have a bank or building society account, you can arrange for your bank or building society to pay your rent direct to your landlord.

If you don’t have an account you may want to open one.  The main types of bank account are:

  • a current account at any bank or building society; or
  • a basic bank account

To open a bank or building society account , get in touch with the bank or building society you have chosen. You can visit the branch in person or in some cases you can do it by phone. You will need to provide proof of who you are and where you live. The bank or building society will tell you which documents they accept. Typical things are:

  • a current passport
  • a full current driving licence
  • a recent council tax or utility bill
  • a letter from a government department or a local authority confirming a right to state benefits such as Pension Credit, Child Tax Credits, Income Support, Housing Benefit or Council Tax Benefit.

Tell the bank you need an account that money can be paid into directly. If you want an account that you can access from your local Post Office, make this clear.

Tell the bank if you want a basic bank account and ask for it by name.  You do not have to pay a minimum amount into this type of account each month and they do not have overdraft facilities so there is no danger of running up debts or charges.

Who is Local Housing Allowance paid to?

Local Housing Allowance is usually paid to you and not to your landlord.

In some very special cases we may pay it to your landlord, for example, if:

  • we think you are likely to have difficulty managing your own affairs
  • we think you are unlikely to use your Local Housing Allowance to pay your rent
  • you have built up eight weeks or more rent arrears
  • you are having deductions made from your Income Support, Jobseekers’ Allowance or Guarantee Credit to pay off rent arrears
  • you qualify for backdated Local Housing Allowance or there has been a delay in processing your claim and a large amount of benefit is to be paid. In these cases we can decide to make the first payment of LHA by cheque payable to your landlord, although it would be sent to you

Rent arrears

If you have built up eight weeks rent arrears or you are having deductions for rent arrears taken from your Income Support, Jobseekers’ Allowance or Pension Credit we will normally pay your Housing Benefit to your landlord.

The landlord must provide evidence to show the rent that is due, any payments that have been made and the amount of rent outstanding.

Landlords are encouraged to contact the Benefits department when rent arrears are equal to five weeks’ rent. This allows the Local Authority time to gather information before the arrears reach the equivalent of eight weeks’ rent.

If you want to tell the Benefits Service that your tenant is in arrears with their rent, please download the Landlord Rent Arrears Pro Forma (DOC 62KB) and complete and return it to us with supporting evidence.  

“Safeguard”

“Safeguard” is used where direct payment to the landlord helps claimants who might not otherwise be able to pay their rent themselves. The direct payment is a safeguard to ensure rent is paid on time and the claimant and their family can continue to live in their home.

The Council can pay Housing Benefit to the landlord for up to eight weeks while it is gathering information to help it decide who to pay Benefit to.

Some of the groups included in the safeguard policy are

  • People with learning difficulties
  • People with medical conditions that seriously affect their ability to manage on a day to day basis
  • People who are unable to read, write or speak English where this affects their ability to manage their financial affairs
  • People with addictions to drugs, alcohol or gambling where this affects their ability to manage their financial affairs
  • People who have experienced recent changes and as a result need additional support in managing their affairs
  • People who are receiving help under the Supporting People scheme  
  • People with a history of homelessness and/or rough sleeping who are receiving help to sustain a tenancy in the private sector
  • People who are receiving help from a homeless charity
  • People with severe debt problems or recent County Court Judgements
  • People who are unable to obtain a bank account, including people who are physically unable to open an account
  • People who have deductions from their Pension Credit, Income Support or Jobseeker’s Allowance for housing costs – housing costs include service charges and utility bills, which are part of the rent

This list is not exhaustive. Each case will be looked at on its own merits.

How long will my Local Housing Allowance last for?

Once your Local Housing Allowance has been calculated, it applies from the start date of your claim and lasts for one year unless a review is triggered by one of the following:

  • A change in your circumstances which affects the category of the dwelling you are entitled to, for example, a child sharing a bedroom reaches 16, someone joins or leaves the household and this changes the number of bedrooms you need
  • A death in the household
  • A change of address

Providing there have been no changes in your circumstances, our benefit assessors will automatically recalculate your Local Housing Allowance claim after one year of payment.  The new benefit will be based on the Local Housing Allowance rate in force at the time.

What do I need to do?

At the moment you do not need to do anything.

If you are already getting Housing Benefit this will not affect you unless you are a private tenant and on or after 7 April 2008, you:

  • Move
  • Have a break of at least a week, in your Housing Benefit
  • Make a new claim

What if I need more information?

If you are thinking of moving or making a new claim on or after 7 April 2008 and would like some advice on how this will affect your benefit, or you would like information about opening a bank account, please contact us:

  • By phone: call us on 020 8496 3000
     
  • In person: call in at one of our Waltham Forest Direct Shops. They are open 8.30am - 6pm from Monday-Friday , and 9am - 1pm on Saturdays:
     
    • Waltham Forest Direct
      772-776 High Road
      Leyton  E10 6AE
       
    • Waltham Forest Direct
      137 Hoe Street
      Walthamstow  E17 4RT
       
    • Waltham Forest Direct
      819 High Road
      Leytonstone  E11 1HQ

Local Housing Allowance has already been piloted by some local authorities. From 7 April 2008 it will be introduced nationally for all local authorities. The national Local Housing Allowance scheme is slightly different from the piloted scheme.