New Online Landlord Universal Credit System to Allow Direct Rent Payments

The pilot of a new online system allowing tenants in receipt of Universal Credit to pay rent directly to private rental sector (PRS) landlords has been successful.

Started on 3rd October 2018, Caridon Landlord Solutions has been working alongside The Department for Work and Pensions (DWP) to bring out this new system. It will replace the two existing UC47 forms, cutting down processing time from in excess of three weeks to just two hours in some recorded cases.

DWP aims to officially launch this online system before the end of 2019, although a date has yet to be confirmed.

The current system requires landlords to download and fill out a form from GOV.UK, in order to apply for an Alternative Payment Arrangement (APA) to have the housing element of Universal Credit paid directly to them.

Caridon Landlord Solutions provides specialist advice on Universal Credit and Housing Benefit to private landlords, letting agencies and housing associations. It points out that the existing UC47 system has caused a whole host of problems, which have discouraged landlord from letting to tenants in receipt of Universal Credit. Subsequently, this has made it difficult for tenants to keep hold of homes they wish to remain living in.

Sherrelle Collman, Managing Director of Caridon Landlord Solutions, says: “This current system can be complicated as there are two types of UC47 forms. The first is the secure form, which can only be submitted by post or via email.

“However, to submit by email, landlords must have a secure email address recognised by DWP, including gsi or gov.uk owing to the fact the form requests personal details such as a tenants’ National Insurance number and the landlord’s bank details.

“This helps to ensure that all parties comply with data sharing regulations as set out under the General Data Protection Regulation (GDPR). The none secure form can still be submitted via email, however, the process can sometimes be slower as the claimant’s case manager has to contact the landlord to request bank details, because due to the non-secure data certain types of personal information cannot be submitted in this way.

“Caridon believes that the paper forms are taking weeks to be processed, sometimes getting lost along the way and all the while rent arrears are mounting up. We have been working closely with DWP, not only to get payments made directly to landlords where necessary, but also to speed up the process so that landlords have greater confidence in the system.”

As well as providing support to landlords in the case of rent defaults, the UC47 is also used for historical debt collection, where a tenant has fallen into eight weeks or more of arrears and the landlord wants to apply for third party deductions. In these cases, DWP takes a small percentage of the claimant’s personal allowance and transfers it to the landlord towards the rent arrears.

Sherrelle adds: “We have been working with DWP to develop an agile online system, making suggestions for adjustments to ensure it is as user friendly and efficient as possible.  Landlords are now receiving confirmation of direct payments within 48 hours which is such an incredible improvement.”