Debt Awareness Week 2023: Support for those living in the PRS
This week is Debt Awareness Week, an annual awareness week run by leading debt support charity, StepChange.
The awareness week coincides with new figures published by the ONS this week, revealing the cost of living rose in the last month with consumer price inflation rising to 10.4% in the year to February from 10.1% in January.
Recent NRLA research also reveals that landlords are facing rising mortgage costs, and according to Step Change, 50% of renters and 38% of mortgage holders expect their housing payments to rise in the next 12 months.
Given the cost of living crisis is continuing to bite, it is likely that some tenants may find it increasingly difficult to pay some or all of their rent at the moment.
This year, Debt Awareness Week aims to shine spotlight on the fact that debt can happen to anyone, and the NRLA is sharing guidance and resources on this subject.
How to help a tenant facing financial difficulties or rent arrears
There was some financial support offered in the Budget last week, that the planned 20% increase in the Energy Price Cap would be delayed from April to July 2023. However, according to the NRLA's Spring 2023 Tenant Survey undertaken by consultancy Dynata, of the 2000+ tenants surveyed, 6.8% have rent arrears.
The NRLA has plenty of useful guidance online when it comes to helping landlords and their tenants work together to manage rent arrears.
It can be extremely worrying for a tenant to fall into rent arrears, so the first step is for the landlord and the tenant to make contact with each other about the matter and have an open and honest conversation to establish exactly what the situation is, and then work together to work out a solution that both parties were satisfied with.
The NRLA’s Managing Rent Arrears guidance can be accessed by members here. It includes information on managing arrears payments, agreeing a repayment plan, and breathing space.
Universal Credit
It is also worth remembering that a tenant who is experiencing financial difficulties could be eligible to apply for Universal Credit or housing benefit.
We have a range of guidance online when it comes to Universal Credit, housing benefits, and how to apply.
In relation to this, the NRLA continues to campaign for the Government to realign rents to the median market rents (50th percentile) and for an end to the benefit cap so that tenants can receive the full LHA rate towards their rent.
Breathing Space: What do I need to know?
Landlords are also reminded that the Debt Respite Scheme (breathing space) was introduced on 4th May 2021.
The scheme allows people in England and Wales with ‘unsustainable debts’ to arrange to enter a breathing space, and during this time landlords can not request payment of a debt or take enforcement action around the debt.
There are two types of breathing space that a tenant may enter into: a standard breathing space and a mental health crisis breathing space.
This page provides guidance on preparing for breathing space, including best practice tips on mitigating the risk to you. Learn more here. Learn more here.
Other places to find help.
As well as the charity Step Change, there are other dedicated charities offering advice, support and resources around managing debt:
The Department for Work and Pensions website, if you are looking for more information about Universal Credit or how an application can be made.
Universal Credit Advances page on the Department for Work and Pensions website, should a tenant wish to apply for a budget advance during the five week wait for the first payment of Universal Credit.
