Renters in Scotland now have access to an interest free, hardship loan scheme to help pay-off COVID-related rent arrears.

Similar to the Welsh Tenant Saver Loan Scheme launched last month, the Scottish government has put aside £10 million for its new Tenant Hardship Loan Fund for tenants who can’t access other forms of support to pay their housing costs. The Discretionary Housing Payment fund, which helps tenants claiming benefits, will increase by £3 million, bringing the total to £19 million.

Holyrood’s move has prompted the National Residential Landlords Association to call for a similar scheme for England. Policy director Chris Norris says that once again the UK Government finds itself trailing behind the rest of the UK. Says Norris: “The best way to prevent repossessions is to tackle the root cause by ensuring tenants are able to pay their rent.” 

Scottish Housing Minister Kevin Stewart says the new announcement will mean that no one should be left in a position where they can’t access support. He says: “I fully expect landlords to be flexible with anyone facing such challenges, signposting them to the sources of financial support available, and tenants in difficulty should engage with their landlord and seek advice on the options open to them.”

He also confirmed that emergency legislation will be extended to ensure no evictions can take place until March 2021 but is reverting back to a one-month period for repossession where tenants have behaved in an anti-social or criminal way.

The Scottish Association of Landlords welcomes the Tenant Hardship Loan Fund but fears tenants will be cautious of accessing a loan that would add to their debt. 

Chief executive John Blackwood tells LandlordZONE: “We hope the Scottish Government will consider additional support in grant form to help tenants pay their rent and prevent us facing a greatly amplified problem for a key part of the housing sector down the line.”

But Shelter is less keen on the loans initiative. “The answer to rising tenant debt is not another form of debt,” says Gordon MacRae, Assistant Director for Communications and Advocacy at Shelter Scotland.

“This proposal is tone deaf to the needs of renters and was cooked-up behind closed doors with no consultation with tenants and their representatives.

“The Scottish Government must produce a solution that doesn’t see tenants footing the bill for this pandemic.”

Read the proposals in full.

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