Local Housing Allowance

Local Housing Allowance

Local Housing Allowance (LHA) is a new scheme for people in privately rented accommodation who make a new claim for Housing Benefit on or after 7th April 2008. If you are already receiving Housing Benefit on this date these new rules will not apply to you. However, if you move address or stop claiming Housing Benefit for at least one week, we will work out your new claim under the LHA rules.

LHA replaces the old rent referral scheme with a system of Local Housing Allowances based on the area in which you live and the number of people in your household.
This new scheme will remove the need for the Rent Service to value each individual property and will mean that you can find out how much LHA you will be entitled to before you move into a property without the need to complete a Pre Tenancy Determination form.

BRMA

Every property in the country will be included within a specific Broad Rental Market Area (BRMA). Stratford District has 7 BRMA:

• South Warwickshire
• Solihull
• Worcester North
• Worcester South
• Cheltenham
• Cherwell
• Rugby & East

Each area will have a separate set of LHA rates which the rent service will update each month. Once a rate is applied to your claim it is valid for 52 weeks unless you move address or there is a change in the size of your household which affects the bedroom rate you need.

To work out how much Local Housing Allowance you will be entitled to you will need to know which BRMA your property is in and how many bedrooms your household needs based on the list below.

One bedroom is allocated to every single adult or adult couple

An additional bedroom will be allocated for:

• Any other person over the age of 16
• Any two children of the same sex under the age of 16
• Any two children under the age of 10
• Any other child

Each person should be allocated to the first category that applies to them and can only be counted once.

Single claimants under the age of 25 and tenants who share their facilities will be entitled to the 1 room with shared facilities LHA rate.

Shared accommodation is defined as exclusive use of one bedroom with shared living room, bathroom and kitchen facilities. For example someone who has a Joint Tenancy will received the shared accommodation rate because they share their living room, bathroom and kitchen facilities with the other tenant.

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Five bedroom property LHA rate

From April 2011 this LHA rate will no longer be available; meaning the highest property rate under LHA rate will be four bedrooms. This does not mean that customers cannot rent a five bedroom (or larger) property, only that the eligible rent will be restricted to the four bedroom level.

How will this affect me?

Existing customers with the five bedroom LHA rate will be capped at the four bedroom LHA rate when:

• • they move
  • their LHA anniversary comes round, or
  • their LHA rate needs changing due to a change in the household

Eligible rent above contractual rent

From April 2011 the £15 per week excess is being removed so the eligible rent will always be the lower of the contractual rent or the LHA rate.

How will this affect me?

Existing customers will lose the excess after April 2011 when

• • they move
  • their LHA anniversary comes round, or
  • their LHA rate needs changing due to a change in the household

LHA Rates to be Capped

From April 2011 the maximumLHA rates will be capped to the rates below:-

Existing customers will get the LHA rates based on the new calculation after April as soon as:

• • they move
  • their LHA anniversary comes round, or
  • their LHA rate needs changing due to a change in the household

Calculating the LHA rate

From April 2011 the LHA rates will be calculated in such a way as to produce lower amounts. The current calculation is based on the median of market rents, the new calculation will be based on the 30th percentile of market rents.

The BRMA codes that fall within the district are:-

• 110 - Cherwell Valley
• 20 - Solihull
• 29 - Warwickshire South
• 30 - Cheltenham
• 45 - Worcester North
• 46 - Worcester South
• 53 - Rugby East

If you are unsure which BRMA you fall into please use the following link to the Valuation Office Agency website or contact the District Council on 01789 260991.

How will this affect me?

Existing customers will get the LHA rates based on the new calculation as soon as:

• • they move
  • their LHA anniversary comes round, or
  • their LHA rate needs changing due to a change in the household
• • Existing customers may receive up to nine months protection from the lower LHA rate if the eligible rent since April 2011 is now lower than the eligible rent level prior to April 2011.

Non-Depenant Deduction Rates

Non-dependant deductions for Council Tax Benefit

Non-dependant deductions for Housing Benefit

LHA Payments

Usually you will have your Local Housing Allowance paid directly to you. It is then your responsibility to pay the rent to your landlord. If you don't pay your rent your landlord may take action against you.

If you do not already have one, you may want to set up a bank account. That way you can pay the rent to your landlord by setting up a standing order or direct debit. The Financial Services Authority (FSA) have provided an independent leaflet about the different types of basic bank accounts available. The Leaflet 'Just the facts about basic bank accounts' is available in any Council office or can be downloaded from the FSA website.

Stratford on Avon District Council is committed to the welfare of the more vulnerable residents of the District. If you think that you are in arrears or are unable to manage your affairs, a safeguard policy 'Local Housing Allowance Safeguard Policy for Tenants and Landlords' has been developed to guarantee that LHA payments will go directly to Landlords, in accordance with LHA rules, where it is considered that someone is vulnerable or unlikely to pay. These safeguards have been put in place to ensure that those who are vulnerable or who do not intend to pay their rent minimise the risk of falling into rent arrears, eviction and to reassure Landlords. A full copy of this policy is available from Council offices. An abridged version will be available on the website shortly.

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Discretionary Housing Payment

Discretionary Housing Payments (DHP) will continue to be available to claimants on both the Housing Benefit scheme and the LHA scheme. DHP is discretionary payment that the Council may award to claimants who are eligible for Housing Benefit to help 'top up' their Housing Benefit to the level of their rent. An application form and leaflet is available to download.