the practicalities of bill splitting in student house shares

[Youhavetoquitwhileyoureahead]

Sorry if it's been done many times! (and yes I am a backpacker if that term is still in use!)
DC in the middle of making arrangements for next year's private rental, and they're wondering how to arrange the bill splitting. Rent has to be paid from one account (agency says, so no further debate on that!). Newspaper columns say set up a joint bank account that everyone pays into, and pay the rent from that - but do banks actually allow this - so far further enquiries suggest that it's not possible to have a 5 person bank account (not wholly surprising!).

As for the utilities, how do most students do it - does one student pay eg the electric bill and hope the others pay them back? (Obviously better to have all the names on the bill, but again, do utility companies actually do this? and anyway one person still has to set up the direct debit..)
All tips (and warnings!) gratefully received and passed on!

Ok

So in some places the utilities are included and it's just the rent. And broadband on top.

In one place we paid the rent to one of the students who sent it on monthly.

In another place we all paid individually to the landlord directly. It all depends.

And in student accommodation it's completely different again. We just paid rent individually and he utilities were included

Thanks Souther - yes, I now very much see the advantage (to the student, not necessarily the landlord!) of bills being included in the rent in a private rental!

One student paying seems a lot of responsibility for that student - especially for one of the major bills like rent, utilities etc. But I don't really see an alternative if you can't set up a joint bank account (which I suppose would have its own risks...)

Every house my two have lived in has had each student responsible for paying their own rent, and bills have been included. Have they got individual rental contracts? If they haven't, and one defaults, the others end up liable for their share.

Precisely floatingboater - no, not individual rental contracts, it's a joint tenancy - and if the landlord or agency insists the rent is all paid from one account (why? very much not in the students' interest to do this but probably does make less admin hassle for the landlord and agent), there is as you say a potential difficulty!

I think the default offered is often joint tenancy - and if you're in a demand exceeds supply area (may be rarer these days with so many staying at home to study online? if so let's hope students are benefiting from better rental terms), there is not much negotiating power. It does seem to vary massively between areas - and even between landlords!

My dd's house has bills (water, gas, electricity & broadband) included in the rent. They are however capped at £10 per week each, so £200 per month. Hope they don't leave the heating on 24/7 with all the windows open🤪

Oh that's interesting towers, so does the rent fluctuate with the bills? Again that is not the contract my dc has got, but it is interesting that some landlords organise things in a way that is a bit more convenient to the students!

Maybe something for students to look out for - but if you're in an area where it's a rush to find somewhere you may find yourself with not much choice - and I imagine that the bill splitting seems like a problem for the future at that point!

Could it be something to do with getting around the HMO regulations?

It doesn’t work for rent but I used Split the Bills when I was at uni a few years ago. The company pay the bills but you individually owe them.

I’d double check that the house they are renting is a registered HMO. It’s highly unusual for people renting a HMO not to have individual agreements.

Thanks all! Yes I've heard of splitthebills - that may be the answer!
Interesting - i thought joint tenancies were pretty much the norm for student rentals (private rentals rather than university, that is - with university rentals as you say it is all one student, one rent, one bill - much simpler!)

I think it's quite legal for an HMO to be let as a joint tenancy - though where a house is let to strangers obviously that doesn't work.

DD has dealt with most of the bills in her house and her housemates pay her back. Although another student does the broadband. If doing it this way, it is important to have housemates you trust and are friendly with.

All the houses my DD’s have rented as students (total of 4 so far) have been on joint tenancy and were licensed HMO’s so this is pretty standard in some places.
Bills are done by one student opening a separate bank account just for the house. Each student pays a standing order each month sufficient to more than cover estimated bills inc tv licence. Utilities were put in all tenants names (yes, you can have 5 people named on the electric bill). Regular checking of the meters to ensure they weren’t going over budget. In your scenario this could be done to include rent but, as a suggestion, each student pays a minimum one month in advance into the account from the date the rental payment is due so it is never late being paid.

Ps some banks do allow joint accounts with more than 2 parties to the account but doing this links any future credit checks/ratings so should be done with caution.

@Youhavetoquitwhileyoureahead

Oh that's interesting towers, so does the rent fluctuate with the bills? Again that is not the contract my dc has got, but it is interesting that some landlords organise things in a way that is a bit more convenient to the students! Maybe something for students to look out for - but if you're in an area where it's a rush to find somewhere you may find yourself with not much choice - and I imagine that the bill splitting seems like a problem for the future at that point!

She's not moved in yet, but I've gone through the contract, the rent is same each month and anything over the capped amount is owed at the end of tenancy.

So helpful, thanks everyone, and glad to hear that some have operated the 'single student pays' system (or dividing it between a rent payer and a bill payer) without any nightmares occurring! As pp say, you need reliable house mates for this - interesting that in some cases 19 yr old students are having to decide this financial risk two months into their first term (when sharing decisions are made in November!). Still, it is true that I haven't heard horror stories (yet!)

Good idea to suggest that everyone pays in in advance for the rent (and maybe utilities as well) so that the single payer always has enough funds in the account.

And that is a very good point about linked credit checks and a joint bank account - I had seen reference to that, but couldn't work out how that would be a problem. Also i imagine you try to ensure there's no overdraft facility! I think dc have decided not to go down that route because of the difficulty of finding a bank that will do it - interesting that some will!

Depends on how much the housemates trust each other.

My sister got royally screwed over when a housemate dropped out mid course, leaving her to stump up for bills and rent.

I'd suggest if one person if going to be responsible for the account, then some sort of contract is drawn up regarding when and how payments are made.

We renegotiaed so all paid rent seperatley

Used one of the bill paying companies very easy to set up everyone pays a monthly direct debit

yes that's the kind of scenario I'd be wondering about Fix - or not even dropping out, but just not paying up! Could be a bit of a nightmare continuing to live together in that situation. Students have to take on a lot of financial risk it seems, particularly where it's a joint tenancy. Not a risk that all 'grown adults' would agree to take with someone they met two months ago!

(Sometimes there's an option of staying in university accom which solves that problem, but by no means always.)

My DS is in exactly the same situation OP. All the houses they looked at were the same so I'm not sure it's that unusual, unless peculiar to the Bristol area?!

They still haven't worked out what they are doing and move in next week 🙄

In each of my uni houses two students set up a joint account and everyone else had a standing order going in there each month that included rent and bills.
At the end of the year we split any money left in the account.

My 5 have never set up joint accounts. With the younger two I think the houses tended to use apps which deal with the split. I cannot remember the name. In other cases as they were all close friends they just trusted one to pay and the others to pay their share quickly or in advance.

This year my son who is post grad just shares with one person and eg I just paid the last council tax bill (his course is over so the university town treats him as not a student but his flat mate still technically is). I paid the water bill and then divided the cost etc. Their power is on an awful cash top up meter thing you have to charge at a shop or newsagent so no issues there with bills. Broadband is included for them in the rent this year (unusually).

On paying rent from one account sometimes that has been the case. This year I cannot even remember. I think they each pay half. I pay my son each month just before by standing order and then he has a standing order for his half to the landlord but this is a rare student tenancy as only 2 of them. Other years there have been up to 8 or 9 of them in a Bristol house.

Ds and his housemates paid rent separately, but ds paid all utility bills and two housemates reimbursed him. No problems getting the money and the other advantage is that he has a credit history. He has just signed a contract for a flat and no problems with credit check and no guarantor required.
(First graduate role and sole occupier of flat)