Pepper Money is the latest lender to remove DSS tenant restrictions on lending to landlord who rent out to a DSS tenant from the 29 June 2019.

The Mortgage Lender (TML) has also said that it has removed the restrictions on mortgages with benefits tenants (DSS tenant restrictions) in-situ last week.
The good news is that most mortgage lenders will to lend to landlords letting to tenants receiving benefits.

Paul Adams, who is the sales director at Pepper Money, commented: “We’re really pleased that we have been able to make the necessary risk and process changes to remove the DSS restrictions on our buy-to-let mortgages. We are continually reviewing our products and risk criteria to ensure they are appropriate for the market and meet the needs of our customers. This was an area, where it was clear that change was required, so we have listened to the feedback and made those changes a reality.”

If this trend continues than renting to DSS will not be the problem that it has been in the past.

What is a DSS tenant? DSS stands for Department of Social Security, which means DSS tenants receive financial housing benefits from the local council, also known as Local Housing Allowance (LHA). The allowance will contribute towards their living expenses.

In the past most lenders have specified that properties can’t be rented to a DSS tenant as they felt it was a high risk. Many landlords also placed the same restriction on their tenants although a lot preferred these tenants as the money was often paid directly to the landlord from the local authority.

This should now mean that it will now be easier to obtain a mortgage if lending to a tenant on benefits as they will have a choice of more lenders. The Finance House can advise on the best deal for landlords, http:thefinancehouse.co.uk/mortgages-2/.

For more information on benefits click here