Implementation of the Government’s new Local Housing Allowance (LHA) next month will have implications for those landlords who provide privately rented accommodation to individuals on state benefit.
In most cases, the LHA, which replaces Housing Benefit, will be paid to the tenant, who will become responsible for paying the rent to landlords. This is a significant change from the current procedure where Housing Benefit is paid to the landlord.
The scheme has been running in small pilot areas over the last few months, but is now going to be rolled out nationally from the 1st April 2008. The idea is to simplify the rules and to allow tenants more freedom, both financially and be able to choose for themselves, where they want to live.
Local Housing Allowance is a flat rate allowance based on the size of the household and the area in which a person lives. There are no changes to the entitlement rules-this will be based on a person’s income, savings and proof of a valid tenancy. Payment will normally be forwarded to the tenant, who will then pay the landlord.
Prospective tenants will be able to shop around with their allowance. If they find a property they like, with a rent that exceeds their LHA, they will have to make up the difference themselves. But if they find somewhere with a rent below their allowance, they will be able to keep the difference up to a maximum £15.00 per week.
Editor: Simon Weston-www.myfirsthomeltd.co.uk
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