RENT COLLECTION AND ARREARS POLICY

Approved by Committee / March 2013
Review Date / March 2016
Author / C Hughes
Introduction
1.1 / Manor Estates recognises the importance of ensuring that there are appropriate procedures in place to manage collection for rent and to deal effectively with non-payment of rent.
1.2 / This Policy is also crucial to achievement of the Association’s Corporate Aim and associated objectives:
Corporate Aim
To provide good quality, affordable and sustainable housing and offer services to meet a wide range of housing needs
Corporate Objectives
  • Provide a good quality management and maintenance service which is responsive to our customers’ views and needs;
  • Make the most effective use of our housing stock and other assets; and
  • Operate to the highest standards in our management and control systems in order to enable the Association to meet its objectives.

2. / The Scottish Social Housing Charter
2.1 / This Policy reflects the Association’s commitment to the Scottish Social Housing Charter, specifically:
1 Equalities
Social landlords perform all aspects of their housing services so that:
  • Every tenant and other customer has their individual needs recognised, is treated fairly and with respect, and receives fair access to housing and housing services

2 Communication
Social landlords manage their businesses so that:
  • Tenants and other customers find it easy to communicate with their landlord and get the information they need about their landlord, how and why it makes decisions and the services it provides

9 Housing Options
Social landlords ensure that:
  • People at risk of losing their homes get advice on preventing homelessness

11 Tenancy Sustainment
Social landlords ensure that:
  • Tenants get the information they need on how to obtain support to remain in their home; and ensure suitable support is available, including services provided directly by the landlord and by other organisations

13 Value for Money
Social landlords manage all aspects of their businesses so that:
  • Tenants, owners and other customers receive services that provide continually improving value for the rent and other charges they pay

14 and 15 Rents and Service Charges
Social landlords set rents and service charges in consultation with their tenants and other customers so that:
  • A balance is struck between the level of services provided, the cost of the services, and how far current and prospective tenants and other customers can afford them
  • Tenants get clear information on how rent and other money is spent, including any details of individual items of expenditure above thresholds agreed between landlords and tenants

3 / Equalities Statement
3.1 / The Association is committed to equal opportunities.
3.2 / A summary of this Policy can be made available in alternative languages or formats on request.
3.3 / Specific reference to how we will make sure that this Policy does not discriminate against any tenant on the grounds of ‘sex or marital status, or racial grounds, or on grounds of disability, age, sexual orientation, language or social origin, or of other personal attributes, including beliefs or opinion such as religious beliefs or political opinions’ is made throughout the Policy.
4 / Aims and Objectives
4.1 / The overall aims of this Policy are:
  • To maximise collection of rent; and
  • To minimise the loss of rental income through prompt, sensitive and effective recovery of rent arrears.

4.2 / Our key objectives are:
Income Maximisation and Arrears Prevention
  • To make as wide a range of payment methods as possible available to all tenants and to ensure that these are widely publicised.
  • To prevent arrears arising in new tenancies by offering advice, information and support to prospective and new tenants.
Management of Arrears
  • To establish early personal contact with tenants where arrears do arise.
  • To ensure that all tenants have access to welfare benefits and debt counselling advice.
  • To establish and maintain good relationships with tenants to help them address problems that may impact on their ability to maintain regular rent payments.
Enforcement Action
  • To enforce action for the recovery of rent arrears where appropriate.
  • To sanction the use of eviction only as a last resort.

5 / Rent Payments
5.1 / The Association offers a wide range of payment methods to tenants. These are publicised widely and the Association also offers advice on the methods that are most appropriate for individual circumstances.
5.2 / The Association credits rent payments to tenants’ accounts within 1 working day of the payment being received.
6 / Preventing Rent Arrears – New Tenancies
Note: Interpretation services will be made available (through Languageline) for any interviews conducted with applicants/tenants whose first language is not English)
6.1 / Pre-Tenancy
The Association will conduct detailed interviews with applicants for housing, prior to a tenancy offer being made. The purpose of the interviews will be:
  • To assess and verify the applicant’s circumstances;
  • To issue a summary of the tenancy agreement and rent payment information pack;
  • To discuss a range of tenancy-related issues with the tenant;
  • To make it clear to the tenant that they will be required to make an initial payment at the start of the tenancy, even if they will be claiming housing benefit; and
  • Establish if the applicant is likely to need support to sustain their tenancy, either on a short-term or long-term basis.
Where it appears that a prospective tenant is not engaging with the Housing Officer at this stage, we will consider the following options:
  • Discontinue consideration of the applicant for offer;
  • Offer a Short Scottish Secure Tenancy, with a requirement that the applicant accepts support, either from the Housing Officer or an independent agency;
  • Offer a Scottish Secure Tenancy but flag the tenancy to ensure an agreed plan of follow-up work is put in place and adhered to.

6.2 / Sign-Up
The pre-tenancy interviews will remove the need for detailed discussion of issues at sign-up, the main focus of which will be to sign the tenancy agreement, issue keys and arrange for completion of housing benefit applications, where required.
Where the tenancy has been flagged as a potential concern, the Housing Officer will conduct the sign-up process, otherwise this will be done by a Housing Assistant.
We expect tenants to recognise that it is their responsibility to ensure that the rent is paid, regardless of whether or not they are entitled to housing benefit. All prospective tenants will, therefore, be required to make a payment at sign-up, the amount requested will be determined by individual circumstances. Where the prospective tenant does not make payment at sign-up, we will withdraw the offer of housing.
6.3 / Post- Allocation Visit
The Housing Officer will carry out a post-allocation visit to all new tenants, within the following timescales:
  • For transfers/applicants who appear to have engaged with us and give no cause for concern – within 4 to 6 weeks of tenancy start;
  • For first-time tenants or applicants who do not appear to be engaging with us or there is evidence to suggest cause for concern – within 2 to 3 weeks of tenancy start.
Where problems are identified through the post-allocation visit, a further visit will be arranged within 4 weeks.
7 / Managing Arrears – Early Intervention
Note: The Association recognises that the impact of changes introduced by the Government’s reform of welfare benefits could result in more tenants experiencing difficulty in paying rent. We have been working with tenants to ensure that they have access to good information and advice about how the changes will affect them and we will continue to do so.
However, all cases of non-payment of rent will be dealt with in accordance with this Policy, including those where arrears have arisen as a result of the welfare benefit reforms.
7.1 / The Association recognises that early intervention is the key to prevention of serious rent arrears problems.
7.2 / First-Time Arrears Cases
We aim to contact any tenant whose account has gone into arrears for the first time within 7 working days of the arrears balance showing on the account.
We will use a range of methods to contact tenants, tailored to specific needs where appropriate, but principally following the methods noted below, proceeding to the next method where there has been no response to the previous one:
  • Telephone call;
  • Text or email message;
  • Ad hoc visit;
  • Letter.
At this stage, we will be looking for the tenant to clear the outstanding balance, however repayment arrangements can be negotiated if they are unable to do so. Repayment arrangements will be specific, with an agreed end date and in accordance with guidelines regarding acceptable timescales. Where appropriate, the Association will make use of text messaging and email reminders in respect of repayment arrangements.
Repayment arrangements will be monitored closely and action taken immediately if the tenant defaults on the agreed repayment plan.
8 / Managing Arrears – Escalation of Action
Where a tenant has failed to respond to preventative action or early intervention, the Association will take a firm and fair approach to recovery of arrears.
The Housing Officer’s knowledge of individual cases will be crucial in determining the most appropriate course of action.
Association staff will continue to focus on personal contact as being the most effective method of engaging with tenants, however they will use a wide range of communication methods to contact tenants, including text messages, email, telephone calls and letters. Staff will regularly review how they contact tenants and will make periodic use of non-standard approaches. Staff will also contact tenants outwith normal working hours.
Where appropriate, contact with tenants will be in a format or language suitable for their individual requirements.
(References to levels of arrears balances within each stage are guidelines only and consideration of appropriate action will take account of the individual circumstances of each case).
8.1 / STAGE 1 CASES – Pre NOP
  • Those between completion of early intervention stages and consideration of service of NOP;
  • ‘New’ cases but ones where the tenant has been in arrears previously; and
  • The level of arrears is likely to be below an amount equivalent to 3 months’ rent
In accordance with the conditions imposed by the Pre-Action Requirement, as a minimum the following actions must be taken as part of the early intervention and Stage 1 processes:
  • Attempted contact with tenant
  • Actual contact with tenant
  • Housing benefit information
  • Referral to other agencies
  • Attempted repayment arrangements
  • Actual repayment arrangements
  • Refer tenant to Housing Options Team
Throughout Stage 1, Association staff will continue to try to engage with tenants and reach suitable repayment arrangements. Only where the tenant has failed to respond and reach an appropriate repayment arrangement, and all the pre-action requirements have been met will the Association consider serving a Notice of Proceedings.
8.2 / STAGE 2 CASES – NOP
Prior to service of NOP, the Housing Officer must submit a completed Pre-Action Requirement Form to the Senior Housing Officer for approval.
If the tenant does not respond to service of the NOP within 1 week, the Housing Officer should make at least 2 attempts to make contact with the tenant prior to the NOP becoming effective and the case being considered for escalation to Stage 3.
8.3 / STAGE 3 CASES – Pre-Court Action
Stage 3 cases are those where:
  • There is a live Notice of Proceedings in place; and
  • The tenant has failed to reach a repayment arrangement or the tenant has failed to maintain a repayment arrangement; and
  • Court action is being considered.
Senior staff should be formally involved in cases at this stage of the process. Where court action is being considered, tenants should be given the opportunity to be interviewed by the Senior Housing Officer or Housing Manager.
8.4 / STAGE 4 CASES – Court Referral
The Association is committed to the prevention of homelessness and will only refer cases to Court as a last resort.
All cases referred to Court will be reported to Committee and approval sought to proceed with eviction if the tenant continues to fail to engage and decree is awarded.
Cases will have to be considered individually, however the following principles will be taken into account when decisions on how to proceed are being taken:
First Calling
Where the tenant pays the full outstanding balance prior to the date of the hearing, we will seek decree for expenses only.
Where the case:
  • Has been referred to Court for the first time; and
  • The tenant proposes an acceptable repayment plan prior to the date of the hearing
We will ask that the case be continued for a period of time to enable monitoring of the repayment plan.
Second and Subsequent Callings
Where the tenant has maintained a repayment plan, we will consider the circumstances of the case and will either:
  • Seek a further continuation to enable monitoring to continue;
  • Sist the case; or
  • Dismiss the case, with expenses.
The latter option is likely to be considered only where the arrears balance has been cleared in full or substantially reduced.
Where the tenant has failed to reach and/or maintain an appropriate arrangement for repayment of the outstanding arrears, we will seek a decree for eviction.
8.5 / STAGE 5 – DECREE AND EVICTION
The Association will only seek to obtain a decree where the circumstances of the case indicate that there is no alternative to eviction and the intention will be to enforce the action.
The award of a decree does not result in immediate termination of tenancy, however it is expected if the decree is to be enforced, this will be within a reasonable period and certainly with 6 months.
Individual circumstances will be taken into account, however in principle we will only consider non-enforcement of a decree if:
  • The tenant pays the full amount of the outstanding arrears and legal expenses within 4 weeks of the date the decree was awarded; or
  • The tenant makes arrangements to pay the full amount of the outstanding arrears and legal expenses within 8 weeks of the date the decree was awarded.
Other exceptional circumstances may be taken into account, however non-enforcement of the decree for reasons other than full payment of the outstanding debt would require referral to the Management Committee for approval.
9 / Former Tenant Arrears
9.1 / The Association will pursue all cases of former tenant arrears and other debts that remain outstanding at the end of the tenancy, unless the tenant is deceased and has no estate.
9.2 / Where the former tenant fails to respond to contact regarding outstanding debts or where no forwarding address is available, cases will be referred to a debt recovery agency.
9.3 / Write-off of Irrecoverable Debts
The Association will write off those debts that are deemed to be irrecoverable. In the main, this will relate to former tenant debt only and write off will only be considered when all available options for recovery have been exhausted.
Write-off will take place in accordance with paragraphs 18.3 and 18.4 of the Association’s Financial Regulations. (See Appendix 1).
The Association will also write off former tenant credit balances where it has not been possible to establish the whereabouts of the tenant.
10 / Performance Monitoring and Reporting
10.1 / Each Housing Officer is responsible for monitoring arrears and credit balances within their area and for taking action in accordance with this Policy and the accompanying Procedure Note.
10.2 / The Senior Housing Officer is responsible for monitoring the Housing Officers’ performance and submitting monthly performance reports to the Housing Manager.
Management Committee
10.3 / The Housing Manager is responsible for reporting to the Association’s Management Committee.
Summary figures will be reported to the Committee at its monthly meeting. In addition, more detailed quarterly reports will be presented to Committee in January, April, August and October each year, in a format to be agreed with the Committee.
Tenants
10.4 / Information regarding the Association’s performance on rent collection will be provided to tenants through the Annual Report.

APPENDIX 1

EXTRACT FROM MANOR ESTATES HOUSING ASSOCIATION’S FINANCIAL REGULATIONS

Write off of Irrecoverable Income

18.3 The Finance and IT Manager has the authority to write off individual amounts of irrecoverable income of less than £100, where it is believed that further pursuit would not represent value for money for the Association. All debts written off will be reported to the next meeting of the Management Committee.

18.4The Finance and IT Manager will, at least annually and more frequently if necessary, report to the Management Committee on irrecoverable debts over £100, and where appropriate seek authority to write them off.

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Carolyn Hughes

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