Bank charges whilst receiving JSA

paullittle · 27th October 2007, 12:18

Hi there,

Here's the problem. I am currently unemployed and receiving JSA I also get Housing Benefit, unfortunately the HB is short of my rent by about £100 a month cosequently I am living on about £30 a week to cover ALL bills, food, etc etc...

Last week a standing order for £1 (yes one pound) was not paid due to lack of funds and the Halifax have said they are going to charge me £39 plus interest on the resulting overdraft!

Now, I read somewhere (on Martin Lewis' site I think) that there was some law against banks charging people on benefits. Does anyone know about it? Unfortunately Martins site is down at the moment.

Regards
Paul

Weird Al Yankovic · 27th October 2007, 13:04

I wouldn't have thought so.
Ignoring the unfair bank charges for a moment a bank is still a commercial operation so I doubt they have different rules just because you are on benefit.

demon_x_slash · 27th October 2007, 13:07

If you are receiving state benefits, then you are entitled to reserve that money solely for your own needs - it's money from the Government for your upkeep and your upkeep alone. Read this thread here for more information on how to prevent the banks taking it in charges.

Weird Al Yankovic · 27th October 2007, 15:15

How bizarre.

The DWP said to me when I enquired about this that I'd need to open up a Post Office card account for my benefit to be paid in as there is no facility for DD's and can only be used for paying in benefits.

paullittle · 28th October 2007, 01:19

Martins site is back up and I found the info:

"Q: What else can I do if I am living on benefits?
A: If you rely on benefits for your main income, such as Income Support or Job Seekers Allowance, there is still possibly a way you can claim; though it relies on a slightly different law. All past claims have been based on contract laws but there is another law called the Social Security Administration Act 1992, which says that banks must not take charges from benefits as this money is needed for a person to live on.
If you are in this situation, contact your bank to tell them that you are living on benefits and it should process your compliant. If it still does not help, contact the Financial Ombudsman, but make sure you tell it that you are receiving benefits and your case will be dealt with."

Looks like I will be giving HBoS a call on monday!

HTH
Paul

hanzo · 28th October 2007, 01:40

This is slightly off topic, but for somebody on JSA to have a net rental charge is unusual. It can sometimes happen because of a clawback for an overpayment of Housing Benefit in the past. If this is the case, you can apply for a clawback reduction to £3 per week if you're on JSA. Your local Housing Benefit office will have a form for this.

paullittle · 28th October 2007, 17:41

Quote:

Originally Posted by hanzo

This is slightly off topic, but for somebody on JSA to have a net rental charge is unusual. It can sometimes happen because of a clawback for an overpayment of Housing Benefit in the past. If this is the case, you can apply for a clawback reduction to £3 per week if you're on JSA. Your local Housing Benefit office will have a form for this.

Thanks for that Hanzo, actually that is quite interesting as when I called the benefits office to complain about the rent shortfall the person I spoke to was surprised that I didn't get the full amount as I was on income based JSA which should mean that I get full rent covered. He said that I could appeal but that the rent assesment could be reduced as a result and seeing as I didn't want to make matters worse I didn't bother - I did apply for Discretionary Housing Payment to make up the shortfall but this was declined.

If you know the rule here I would love to hear about it as this is the second period of unemployment have "enjoyed" over the past few years and the same thing happened before. If I should have been entitled to full rent I wonder if I could reclaim. hmmm.

I dunno it seems the less you have the more people want to screw you

Regards
Paul

gizmo111 · 28th October 2007, 18:04

It all depends on the fair rent for your area. Are you living in a property with more than 1 bedroom?

paullittle · 28th October 2007, 18:33

No:
1 bedroom, 1 bathroom, 1 kitchen/diner/living room plus a room that is only useable in the summer (no heating) and a "utility" room with the ancient ch boiler and washing machine

The "fair rent" was assesed at £375 pcm when it is actually £469. I was a bit intrigued as to why the benefits office guy said I should get full rent if on income based jsa...

gizmo111 · 28th October 2007, 18:55

£469 seems like a fair rent to me and you are not overhoused, appeal the decision. Contact your local Welfare Rights who will help you.

GlasweJen · 28th October 2007, 20:02

if you're under 25 there's other rules about housing benefit/allowance that work out you get less, i'm not all that clued up on them as they're very confusing but if you ask welfare rights or CAB i'm sure they can tell you more.

gizmo111 · 28th October 2007, 20:18

If you are under 25 then housing benefit will only pay for a bedsit or shared house. For some reason they don't think you need self contained accommodation before this age. Care Leavers are exempt from (and probably some other groups, I think maybe mental health, disabilites and alcoholics or drug users) this rule and can claim the full amount for housing benefit from the age of 18.

paullittle · 29th October 2007, 01:47

Under 25? I wish!!!

GlasweJen · 29th October 2007, 11:25

Lol just checking, in that case the amount you're being charged sounds fair to me, try getting onto welfare rights, they can work miracles with 10 minutes and a black biro.

paullittle · 31st October 2007, 01:04

ok, how do i get hold of them?

gizmo111 · 31st October 2007, 01:10

Quote:

Originally Posted by paullittle

ok, how do i get hold of them?

Have a look on our local council website

Joa · 31st October 2007, 13:34

Shortfall between the rent due and the HB paid can be explained also in a following way: in most areas of the country (except those which are covered by Housing Allowance) the Fair Rent Office will make a decision about so called "eligible rent". This will be a "fair, reasonable level of rent" for the claimant circumstances, geographical area, type of accommodation, market prices etc. This "eligible rent" often does not reflect the "actual rent" because Fair Rent Officers tend to live in the past! Couple of decades behind the rest of us! The result is that the HB, which is calculated in accordance with "eligible rent", even if paid out at 100% rate (as for people in receipt of IS or JSA) does not stretch to cover the whole "actual rent"- because the base for it's calculation is already wrong (lower).
Discretionary Housing Payments is the recommended way to plug the hole. DHPs are discretionary (i.e. the local authority does not hae to award but the may)- so good supporting evidence and a good personal statement are vital. The crucial issue in applying for DHP is to convince Local Authority that you cannot move somewhere cheaper, that there is not much cheaper accommodation on offer, that you have very strong ties with the area where you live, that you will fall behind with rent and be evicted without help, that you have no other sources of income and that there is a strong possibility that you'll present as homeless without help from DHP.
Good luck.

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