Rent loans in Lichfield help local tenants

Lichfield residents have few options when unable to pay rent. However, these options are actually quite good compared to the resources available in some other locales. In particular, there are several types of loans that have favourable repayment terms that can be used.

These rental loans can be used to catch up on late rent to prevent an eviction. Alternatively, tenants may get help with the rent deposit towards a new property. The options are quite good.

Homelessness Prevention

Council loans of £100 up to £2,000 are offered to local tenants who need the aid to pay rent.  Smaller grants of less than £100 are available to tenants who need a small boost to meet rent demands. These smaller grants do not have to be repaid. The purpose of the fund is to help those who are experiencing a drop in income and who need extra help for a few months.

The Council administers the Homelessness Prevention Fund to ensure that no family is forced out onto the streets. Aid is paid directly to the landlord on behalf the tenant to ensure that funds are used properly. Each tenant must repay the loan based on a simple loan agreement with the Council. Repayment arrangements are such that allow for lower income families to still be able to afford the payments.

In assessing whether to provide the loan, applications are scrutinised to determine whether the aid package will ensure proper tenancy for at least six months. Preference will be shown to solutions that involve permanent tenancy over temporary accommodations.

Repossessions Prevention

The Lichfield District Council also provides loans from the Repossessions Prevention Fund. These funds are used to cure rent arrears, although mortgagors may also access the fund to obtain relief. No history of rent arrears (other than minor delays) prior to the current crisis is the expectation before aid will be authorised.

Normal sundry debtor procedures apply to the repayment of any aid paid through the Fund. There are no grants available. Loans of up to £5,000 are possible through the scheme.

Rent Guarantees

Tenants who cannot afford to pay a rent deposit can have this requirement met on their behalf. The Rent Guarantee Scheme allows for landlord requirements for rent deposit and first month’s prepaid rent to be covered through a Council promise.

This is not a loan as there are no funds being exchanged. Landlords that agree to the scheme accept the guarantee in lieu of an actual deposit being paid. Should arrears or damages result from the tenancy, then the Council will pay those to the landlord. The tenant is responsible for repaying any debt owed to the Council as a result of their actions.

To reduce a tenant’s reliance on government aid, a credit union account will be required as a condition of being covered by the Rent Guarantee Scheme. The account can be used to save for a future rent deposit.

Credit Union Loan

Fusion Credit Union Limited offers loans of just 12.68% APR currently. That’s just a single per cent monthly. Up to £500 may be borrowed to meet emergency rent needs.

An open membership policy means that any residents or workers in Lichfield District is eligible to join. While the first loan is limited to £500, successful repayment means that a subsequent loan could be for up to £2,000.