The Scottish government has announced a £5m fund that will offer interest-free loans to landlords whose tenants are having difficulty paying rent during the Coronavirus crisis.
The Private Rent Sector Landlord COVID-19 Loan Scheme will offer eligible landlords up to 100 per cent of lost rental income for a single property.
It will support private-sector landlords who are not classified as businesses, have five or fewer properties to rent, and who have lost rental income due to tenants unable to pay rent as a result of the COVID-19 pandemic.
“We want to ensure no one loses their home during this unprecedented public health pandemic which is why we passed legislation to protect tenants against any eviction action for six months” explains the Scottish Government housing minister Kevin Stewart.
“While all tenants should pay their rent if they can, we recognise the financial pressure people are facing. The Scottish Government encourages landlords to talk to their tenants about rent payment issues. We also expect landlords to be as flexible as possible with their tenants, discuss managing rental payments and help them find sources of financial support and advice” he continues.
Landlords facing difficulties with repayments on a mortgage for a rental property are expected to seek a mortgage repayment holiday from their lender before they apply for a loan.
The application process requires landlords to confirm they understand the terms of the Coronavirus Act 2020 in relation to eviction proceedings, and that they have discussed rent issues with their tenant and reached agreement on managing arrears.
The chief executive of the Scottish Association of Landlords, John Blackwood, adds: “We are pleased the Scottish Government has taken this first step in helping the private-rented sector weather the effects of the COVID-19 pandemic, which recognises the role private landlords play in the housing system.
“Collectively the housing sector needs an approach that protects all parts of housing in Scotland to guarantee we can provide the different types of quality housing we need. We want to continue to work with the government, as well as other public bodies, trade bodies and charities to ensure to achieve that and hope there will be further steps taken soon.”
The Private Rent Sector Landlord (non-business) COVID-19 Loan Scheme opened for applications yesterday and more information can be found here.