RENT ARREARS PROCEDURE

CONTENTS

Section / Page
1.0 / Introduction / 3
2.0 / Vulnerability / 3
3.0 / Debt Advice / 4
4.0 / Preventing Rent Arrears / 4
5.0 / Procedure / 5
5.1 / Two weeks (Letter 1) / 5
5.2 / Four weeks (Letter 2) / 5
5.3 / Vulnerability report / 5
5.5 / NOSP / 5
5.6 / Action following service of NOSP / 6
5.7 / Referral to court / 7
5.8 / Pre court interview / 7
5.9 / Court hearing / 7
5.10 / After a court hearing / 9
5.11 / Permission to evict / 9
5.12 / After permission to evict / 11
6.0 / Performance Monitoring / 11
Appendix 1 / Arrears Procedure Flowchart / 13
Appendix 2 / Sample Letters / 14
Index of sample letters / 14
Sample letters / 15 - 35
Appendix 3 / Suspended Possession Orders / 36

1.0Introduction

Ensuring that rental income is collected effectively is a key function for a social landlord. There are a range of tools and remedies available to help us to tackle rent arrears, but it is acknowledged that despite years of enforcement action to recover rent, tenant debt remains a major concern. The ultimate legal sanction is eviction but this frequently leaves the landlord with a large irrecoverable debt and substantial legal fees and the tenant on a downward spiral towards homelessness. Eviction therefore has high economic and social costs and emphasis must be placed on preventive as opposed to reactive strategies.

The purpose of this procedure is to establish the basis of our approach to rent arrears. A significant proportion of our time must be spent preventing rent arrears accruing. This will be outlined in detail further in this procedure.

2.0Vulnerability

2.1The tenant's paper file and electronic systems will be checked for information on vulnerability prior to the service of a notice of seeking possession. Tenants who are deemed vulnerable will be offered support to maintain their tenancy. Any tenant who is receiving support will not be evicted while they are working with the Tenancy Support officer or other professional to address the problem of their debt. If tenants who are vulnerable decline help and assistance, we will advise both social services and our legal advisors that we are about to commence legal action against a person we know to be vulnerable.

2.2Where vulnerability is identified, the Housing Officer will offer a referral to the Tenancy Support Officer. Points awarded through the nomination and allocations process will not in themselves indicate vulnerability. In cases of uncertainty advice may be sought from the TSO.

2.3In every case the paper file and electronic records will be checked thoroughly for any notes that may be relevant. Ethnicity will also be recorded. After a full check has been made, the name and date of birth of the tenant will be e-mailed to the TSO, who will check the social services database to ascertain whether any of the family are known to heath professionals anyway.

If the case merits referral to the TSO, a referral will be made. If there are no factors to consider or insufficient factors, a note will be made on file.

In all cases where a decision is made to proceed against a vulnerable tenant a referral must be made to Social Services so that appropriate help and support can be provided.

3.0Referral for Debt Advice (See 5.6 for full Procedure)

3.1Following service of a Notice of Seeking Possession, every tenant will be given one opportunity to enter into a voluntary agreement with us to repay their debt. This agreement will be facilitated by HASKC or Nucleus who will ensure that:

the tenant is receiving all the benefits they are entitled to;

a referral is for debt counselling is offered where appropriate;

  • any repayment agreement entered into is reasonable for both landlord and tenant, having regard to the tenant's circumstances.

3.2A tenant who enters into such an agreement with us will receive a written assurance that whilst payments are being made in accordance with the agreement, no legal action will be taken against them. Changes of circumstance, which may occur from time to time, may involve a fresh negotiation of their debt, if the circumstances are considered reasonable. Regular and repeated renegotiation of the repayment plan will not be considered.

4.0Preventing Rent Arrears

4.1At sign up the Housing Officer will:

  • ask how tenants prefer us to contact them;
  • give a clear message about how, when and where to pay, what to do if they fall into arrears, who to contact and how;
  • takeall telephone numbers, including work or mobile;
  • identify potentially vulnerable people at sign-up, including inability to speak English;
  • make a referral to the Tenancy Support Officer if necessary.

4.2At the new tenant visit the Housing Officer will:

  • check that a housing benefit form has been submitted and finding out about the progress of the application;
  • check that the tenant is settling in and appears to be coping;
  • make a referral to the Tenancy Support Officer if necessary.

4.3We will send monthly statements to tenants who are in arrears and maintain regular contact using a variety of methods.

5.0Procedure

5.1Letter 1

This is sent when the tenant is in arrears of £10.00 or more. This letter should say that rent has not been received, as opposed to not been paid.

The letter must show the total amount owed and the currently weekly rent.

5.2Letter 2

Final notice - this is sent two weeks after letter 1 if the arrears have not reduced or cleared.

5.3Vulnerability reportmust be completed after the final notice and before the NOSP.

5.4At least two telephone calls or text messages or one home visit must be documented on the arrears system. This must be noted on the arrears information notes.

5.5Notice of Seeking Possession (NOSP)

If arrears have not decreased after the final notice, a notice of seeking possession will be served subject to a minimum of 4 weeks charges or £50 outstanding. Included with the notice will be the TMO’s own guide to the rent arrears process, and the leaflet giving details of local advice agencies.

The Housing Officer will check whether:

  • there is any housing benefit outstanding;
  • the tenant has a garage or parking bay;
  • the tenant is on the transfer list.

Notices of Seeking Possession can be signed by all officers on SO2 and officers on SO1 with the permission of the Area Manager.

REMEMBER:

  • there must be at least 28 days between the date of service and the date of expiry of the NOSP;
  • the expiry date must be a Monday;
  • the NOSP must state which ground, under the 1985 Housing Act, possession is being sought. For arrears this will be ground 1. It must also state the level of the arrears and the date when this sum was outstanding;
  • the NOSP and cover letter (ARR05-nspletter) must be served either by handing it to the tenant in person, at the property, or by posting it through the letterbox of the property if the tenant is not home (N.B. it must be the individual letterbox to the property not a communal letterbox);
  • a certificate of service must be prepared stating the date and method of service;
  • the NOSP is valid for one year from the date of expiry. If no Court action is commenced in this period a new NOSP must be served;
  • No further legal action can be taken until the expiry date has been reached.

5.6Action following service of a NOSP- referral to HASKC/Nucleus

If there has been no contact from the tenant two weeks after the NOSP has been served, letter ARR06 will be sent. This letter offers an appointment with an independent housing adviser and the opportunity to make a formal agreement to avoid court action [appendix 1].

1If HASKC do not hear from the tenant after a further week, HASKC will contact the tenant directly.

2If, two weeks after the letter has been sent, the TMO has not heard from the tenant, or from HASKC on their behalf, the TMO will follow its standard rent recovery procedure.

3Where the tenant does make contact, the TMO will give a reasonable period of time for HASKC to address any outstanding issues, such as housing benefit.

4Thereafter, as soon as practicably possible, the tenant will be invited into the TMO offices to sign a formal agreement to pay off the rent arrears in instalments. The tenant may request HASKC to be present.

5Whilst the agreement is adhered to, the TMO will not take any further recovery action.

6If the agreement is not adhered to, then the TMO will alert HASKC who will contact the tenant.

7If there are proven extenuating circumstances why the agreement has not been adhered to, the TMO may consider making a new arrangement.

8If there are no proven extenuating circumstances, or if a satisfactory agreement cannot be arranged, then the TMO will revert to its standard rent recovery procedure.

9Having committed to legal action, we will follow through swiftly. No tenant will be taken to court unless the following actions have been completed:

  • a full vulnerability check has been carried out;
  • the tenant has been offered an interview with an independent legal advisor who can also offer welfare benefits advice and debt counselling.

5.7Referral to Court – Letter ARR07

If the tenant fails to respond to letter ARR06 above, letter ARR07 will be sent, advising that the matter has been referred to Court.

Officers who are authorised to sign their own NOSPs will make the referral to the appropriate solicitor.

If the tenant receives Income Support, attempts should be made to secure payment direct from the DWP before referring to court.

The Housing Officer will send full details of all contact with the tenant to the legal team on referral, including a copy of the vulnerability check and the letter offering an appointment with HASKC/Nucleus to avert court action.

5.8Pre court interview – Letter ARR32/33

Two weeks after referral to the Council’s solicitor a pre-hearing interview letter should be sent arranging an interview.

5.9Court Hearing – Letter ARR34

1When the Housing Officer receives notification of a court date, a letter should be sent advising the tenant of the date, time and location of the Court hearing and an appointment should be arranged for the tenant to be interviewed. The letter must arrive not less than ten days before the court hearing. Information on advice agencies must be enclosed, together with an up to date rent statement. The Housing Officer must check the tenant's housing benefit position. Letter ARR34 must be hand delivered and a note made on the tenancy file and within Academy Notes.

2If there are no proven extenuating circumstances, or a satisfactory agreement cannot be arranged, then the TMO will revert to its standard rent recovery procedures.

3Should the tenant attend an interview, agreement should be sought to clear the arrears either by instalments or in full prior to the hearing.

4If the tenant is claiming disrepair the Housing Officer should ensure that an order is raised immediately to remedy the defect. The tenant should be told to continue to pay the rent in the meantime (see the Disrepair Procedure).

5If the arrears are cleared in full the Court hearing will be withdrawn.

6If the arrears are substantially reduced, then the case can be adjourned with liberty to restore, either generally, or on terms, or for 28 days. The decision to adjourn may also apply when there is a genuine housing benefit dispute.

7If the Housing Officer is unsuccessful in making contact with the tenant an Outright Possession Order should be sought at the hearing.

8Should an agreement be made to repay in instalments then a Postponed Possession Order may be sought on the terms agreed.

9The Housing Officer should explain fully what a Postponed Possession Order (PPO) means and the consequences should a payment be missed (i.e. that an application will be made to the court to fix a date for possession without a further hearing).

10Court costs should always be sought except in exceptional circumstances. The decision to waive Court costs should be taken by the Area Manager or above and the reasons why recorded on the tenancy file.

11The Housing Officer should contact the Housing Benefit Section at least one week before the Court hearing to find out whether or not a claim has been submitted or a request for backdating made. The Housing Officer should assist tenants to make claims for backdated Housing Benefit where there is reason to believe that the tenant may be eligible for further payments. This is particularly relevant in the following circumstances – where the tenant has a mental health problem; has difficulty managing their affairs; is receiving assistance from a social worker; is elderly and confused; has learning difficulties; has a serious / life-threatening illness. The Housing Officer should be willing to draft a letter for the tenant and supply a supporting statement.

12Legal Instructions must be submitted so that they are received by the Council’s solicitors at least two working days before the hearing.

5.10After a Court Hearing

1Immediately following a Court hearing the tenant should be written to and informed of the decision of the Court. Depending on the outcome -letter ARR35 (withdrawal), ARR36 (adjourn generally), ARR37 (adjournment on terms) or ARR38 (Postponed or Suspended or Outright Possession Order) should be sent.

2If the Housing Officer is unhappy with a decision made by the Judge, the case should be discussed with the Area Manager immediately upon return to the office. Decisions made by the Judge must be appealed within 5 days of the hearing.

3If the written copy of the Court Order is different from the decision made in Court the Housing Officer should inform the Council’s solicitors so that the Court may amend it.

4Any costs awarded must be added to the relevant sub-account of the main rent account and the tenant informed.

5In the case of Orders granting Outright Possession Letter ARR39 should be sent on expiry of this period advising that their tenancy has finished and any monies paid are accepted as mesne profits for use and occupation only.

6In the case of a breach of an adjournment (either generally or on terms) the Housing Officer should instruct the TMO’s solicitor to apply for the hearing to be re-listed. Letter ARR29 should be sent to the tenant.

7Following a breach of a Postponed or Suspended Possession Order, the Housing Officer must decide whether or not to seek agreement to proceed with the resident’s eviction. Letter ARR40 will be sent offering an appointment to discuss repayment.

5.11Permission to Evict

1Where the tenant is subject to a Suspended Possession Order, if there is a response and a reduced offer is made to repay the debt (eg. if the tenant’s circumstances have changed from working to being in receipt of Income Support), referral (by the resident) should be made to the County Court to vary the terms of the original order. However, if the resident does not apply to vary the terms then the Housing Officer must do so to ensure that the Order remains valid.

2If a satisfactory response is received from a tenant who is subject to an Outright Order (two thirds of the debt initially, then payment in full after any attempt to evict) then consent should be given to stay or postpone enforcement on condition that payments at the rate agreed are maintained.

3Where a tenant is subject to a Postponed Possession Order and there is a breach of any terms, offers to make up any missing payments should be accepted but an application should be made immediately to the Court to fix the date of possession. Such an application is usually made by letter from the TMO’s solicitors and the possession date fixed without a further hearing. However, occasionally the Housing Officer may have to attend Court in person.

4Should there be no response after Letter ARR40, or if there is an unacceptable offer to repay, send Letter ARR41. Where a Postponed Possession Order has been granted using Form N28 the Housing Officer should give the tenant 21 days’ notice of its intention to apply for a date for possession to be fixed. Once a date for possession has been fixed (Postponed Possession Order), or in the case of a Suspended Possession Orderpayments have failed to be made, the Housing Officer should seek Permission to Evict via completion of a Schedule of Eviction. If the tenant’s circumstances indicate that specialist intervention may be required a referral to the Tenancy Support Officer or Social Services (ReferraltoSSTSO2) should be prepared first, clearly indicating the imminent risk of eviction. Submission of the Schedule of Eviction should be halted for two weeks to allow the Tenancy Support Officer Social Services to respond.

5The Eviction Schedule should be presented to the Area Housing Manager for approval and then sent to the Director of Housing Management who will send copies to the Chair of the TMOBoard and the Cabinet Member for Housing for agreement to proceed. Permission is presumed to be granted if no response is sent within 7 days of referral. A copy of this schedule will also go to Social Services and the Housing Needs Department, as they may be aware of the circumstances of the household involved. Every effort should be made to contact any agency that has supported the household prior to submitting the schedule, as there may be the opportunity to resolve their financial affairs.

6Eighttyped Eviction Schedules in total need to be prepared by the TMO. The details of the tenant’s name and address should be kept anonymous on all but two copies that are sent to Social Services and Housing Needs.

5.12After Permission to Evict

For Suspended, Postponed, and OutrightPossession Orders:

1Once permission to evict has been received, again write to the resident (ARR43) advising that an application will be made for a bailiff’s warrant to evict. Invite the tenant to an appointment to discuss. If the tenant fails to make contact, instruct the TMO’s solicitors to apply for a bailiff’s warrant.

2Send Letter ARR44 to notify the tenant that a bailiff’s warrant has been applied for and inviting him / her to make contact with his / her ward councillor.

3The officer should confirm the date and time of the eviction with the bailiff manager at the Court and hand deliver a letter (ARR45) informing the resident of this. Additionally the resident should be informed that any goods left in the property will be stored for a maximum of one month and will then be disposed of.