New Welsh £8 million Tenant Saver Loan scheme for PRS onlyMake Text Bigger
Loans to pay off rent arrears built during the Covid -19 pandemic will now be available to tenants in Wales following a campaign by the National Residential Landlords Association (NRLA).
The new £8 million Tenant Saver Loan scheme, which will apply to the Private Rented Sector only, will allow tenants to borrow money to cover the arrears they have built, with the cash paid directly to the landlord or agent.
Wales’ Minister for Housing & Local Government announced the introduction of the loans scheme today -and the Welsh Government hopes it will be operational as early as September.
As yet there is no cap set on the amount a tenant can borrow and arrears payments can be backdated to 1 March 2020.
Following the announcement, NRLA chief executive Ben Beadle said: “We are delighted the Welsh Government has listened to what we had to say and consequently adopted our proposals for a tenant loan scheme.
“These loans will help keep tenants who have been affected by coronavirus in their homes, while supporting landlords reliant on rental income to pay their own bills.
“We would advise every landlord with a tenant in arrears to make sure they are aware of the new scheme and advise any landlord in receipt of these payments to commit to working with their tenant to maintain the tenancy in the long term.”
While arrears payments will be made directly to landlords, it is the tenant that will need to apply for the loan under the new scheme.
The tenant will then be given up to five years to pay back the money, at an interest rate of 1% APR.
Who can apply for loans?
While designed to help tenants with arrears directly linked to coronavirus – for example, those who have been made redundant – loans will also be available to those with pre-Covid arrears that are not considered substantial’.
However, the Welsh Government says loans can be used to cover future rent payments and it anticipates a tenant will only be able to apply once.
If your tenant is already on benefits, they should be advised to go to their local authority and apply for Discretionary Housing Payments rather than apply for the loan.
The scheme will be administered by Welsh Council for Voluntary Action (WCVA) an umbrella body for third sector organisations in Wales) and delivered by credit unions.
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