Alternative Payment Arrangements: Getting Universal Credit Paid Direct to You

What is an Alternative Payment Arrangement?

Universal Credit (UC) is paid directly to the tenant as a single monthly payment, which they are then responsible for using to pay their rent. An Alternative Payment Arrangement (APA) is a request made to the Department for Work and Pensions (DWP) asking them to redirect the housing element of the tenant's UC payment directly to the landlord.

An APA bypasses the tenant entirely for the housing portion of UC, which means rent arrears stop accumulating from the date the arrangement takes effect.

When can landlords apply for an APA?

Landlords can apply for an APA when:

• The tenant is at least 2 months (8 weeks) in arrears on their rent, OR
• The landlord has evidence that the tenant is unlikely to pay rent (for example, because they have a vulnerability such as addiction, mental health difficulties, or financial mismanagement)

The 2-month threshold is the most common basis for an APA application by landlords. Once arrears reach this level, you can submit the APA request to the local Jobcentre Plus office.

How to apply for an APA

Step 1: Confirm the tenant receives Universal Credit

You can ask the tenant directly or check your tenancy records. If the tenant is receiving UC with a housing element (as opposed to Housing Benefit, which is a separate system), the APA route applies.

Step 2: Calculate the arrears and confirm the threshold

Calculate the total rent arrears. Check that they represent at least 2 months of the contracted rent. If the rent is £900 per month, the arrears must be at least £1,800 to meet the mandatory threshold.

Step 3: Write to the local Jobcentre Plus

Send a written APA request to the Jobcentre Plus office responsible for the tenant's UC claim. The letter should include:

• The tenant's full name and National Insurance number
• The property address
• The total arrears amount and the period they relate to
• The landlord's bank account details (for direct payments)
• A request that the housing element be paid directly to the landlord

There is no standard form - the DWP accepts letters and emails. Some local offices have their own preferred format.

Step 4: Await the DWP decision

The DWP has discretion over APA applications. They will assess:

• Whether the arrears threshold is met
• Whether a direct payment would be in the tenant's interest (for example, if the tenant has vulnerabilities that make managing UC difficult)
• Whether there is a risk of eviction that a direct payment could prevent

If the APA is approved, payments will be redirected from the next UC assessment period.

What happens to existing arrears?

An APA redirects future UC housing payments to the landlord. It does not automatically recover existing arrears. However:

• The DWP can agree to deduct a small amount from the tenant's UC payment each month towards clearing arrears (this is a separate mechanism called a "third party deduction")
• You can pursue the arrears through the First-tier Tribunal as a money claim separate from any possession proceedings
• Section 8 possession proceedings (Ground 8 or Ground 10) remain available in parallel with an APA

Why use an APA instead of going straight to Section 8?

For UC tenants, an APA is often faster and less adversarial than possession proceedings:

1. Court dates for the First-tier Tribunal can take several months to arrange
2. An APA can stop arrears growing within weeks of approval
3. If a tenant is in arrears due to a UC payment delay (common after assessment periods change), an APA resolves the root cause rather than punishing the tenant for a DWP processing issue
4. Maintaining the tenancy preserves the income stream and avoids the cost and stress of finding a new tenant

How STEMHQ helps

STEMHQ's APA feature generates the letter to the local Jobcentre Plus pre-filled with the tenant's details, arrears figures, and your bank account information. The letter is formatted for easy submission by email or post, and the submission is logged in the tenant's escalation record with a timestamp.

STEMHQ also flags UC-linked tenants in the arrears dashboard so you can identify them quickly and prioritise APA requests over Section 8 proceedings where appropriate.