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Tenant loan scheme welcomed by the NRLA

A number of buy-to-let landlords are having to prepare for a potential spike in rent arrears after the latest data revealed that employment in the UK fell by the largest amount in over a decade between April and June. 

The number of people in work decreased by 220,000 quarter-on-quarter, according to the Office for National Statistics.

This was the largest quarterly decrease since May to July 2009, at the height of the financial crisis.

The figures do not include the high number of people who are furloughed, those on zero-hours contracts but not getting shifts, or people on temporary unpaid leave from a job, as they still count as being in employment. 

But the Welsh government has come up with a short-term solution for renters facing financial hardship. 

The Welsh government is now offering tenants loans to pay off rent arrears built during the Covid -19 pandemic - a move which has been welcomed by the National Residential Landlords Association (NRLA). 

The association has been lobbying the Welsh government to provide more support for landlords and tenants adversely affected by the crisis.

The 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 then paid directly to the landlord or agent.

The government hopes the scheme will be operational as early as September.

As yet there is no cap on the amount that can be borrowed and the tenant will be given up to five years to repay the loan.

Following the announcement of the new Tenancy Saver Loans yesterday, 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.”

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