The coronavirus pandemic has caused significant hardship for people around Scotland, creating extreme financial difficulty and worry of evictions and other legal action surrounding debt.
The Scottish government has introduced the Tenant Hardship Loan Fund to address some of the issues being experienced by people who, for various reasons, cannot claim any other form of housing benefit or support.
So what is the Tenant Hardship Loan, and do you qualify?
The Tenant Hardship Loan is aimed at helping Scottish people with coronavirus-related rent arrears to avoid eviction, and applies to both private and social sector housing. If you qualify for the loan, you’ll be able to access crucial help with your rent payments.
The Loan Fund can cover up to nine months’ worth of arrears and future rent payments, starting from January 2020. Any arrears in existence before January 2020 won’t be covered by the loan, however.
You’ll be able to include up to three months’ of future payments in the total nine-month period, offering you some reassurance that you’ll be protected from eviction for a longer period of time.
The loan is interest-free, and repayments don’t need to start for six months. You can repay over a five-year period, or sooner if you have the financial capability, although this is entirely voluntary.
The generous five-year loan term reflects the numerous ways in which the pandemic has caused financial and health problems to the population in general, and the fact that we may be dealing with the effects for years to come.
In order to be eligible for this loan scheme, you must be unable to access other forms of state support. The Fund is intended for those with no support for housing, and therefore extremely vulnerable to eviction by their landlords.
You’ll undergo a financial assessment to ensure you can afford to meet the loan repayments, and this involves determining your surplus income by looking at incomings and expenditures.
Depending on the results of the assessment, you may qualify for the Tenant Hardship Loan, but if not, you’ll be directed to the most appropriate source of financial assistance according to your circumstances. You may be eligible for Universal Credit, for example, or Discretionary Housing Payments.
You can make your application online via the Tenant Hardship Loan Fund website. You’ll need to confirm various pieces of information, including the fact that you’re a tenant and have applied for other housing or financial support where applicable. You’ll also undergo a credit check prior to a loan being sanctioned.
Information required on the application form includes:
If your application is successful you can choose to receive the funds yourself, or have them paid to the landlord directly. If you choose to receive the money yourself, you have a specified timescale to pay it over to your landlord, and you must provide written confirmation that you’ve done so.
For more information on the Tenant Hardship Loan, and whether you qualify, please contact our expert team at Scotland Debt Solutions. We’ll help you develop a household budget to establish your suitability for a loan, and provide reliable independent advice. We can offer you a free, same-day consultation, and work from offices around Scotland.
The breathing space debt moratorium in Scotland enables people in debt to trigger a six-month period that’s free of creditor action, so they can take stock of their situation and formulate a plan.
The Debt Arrangement Scheme in Scotland, or DAS, enables people in serious debt to repay their creditors in full over a longer period of time.
Our Scottish based team can help advise you on your debt problems.