Good news for renters with rent arrears! The Department for Levelling Up, Housing and Communities recently announced a £65 million support package for vulnerable renters. Don’t miss out on this opportunity to get rid of your rent arrears this winter! Here’s what you need to know.
What is the £65 million support package for rent arrears?
During the pandemic, many households, especially vulnerable households, faced financial difficulty to the extent that some faced homelessness. Fortunately, the £310 million Homelessness Prevention Grant offered financial support to prevent eviction, provide temporary accommodation and help people find new homes.
With high energy bills, high living costs and Covid-19 uncertainty this winter, the government has pledged an extra £65 million to help vulnerable renters struggling due to the impact of the pandemic. This is in addition to the previously pledged £500 million Household Support Fund dedicated to vulnerable households struggling with the cost of living.
Minister for Rough Sleeping and Housing Eddie Hughes MP explains, “We have taken action throughout the pandemic to support the most vulnerable families, and it is vital we continue to provide support as we enter the winter months. This new funding will support families that are struggling and help to get them back on their feet as we begin to recover from the Covid-19 pandemic.”
How can you access this fund for your rent arrears?
According to the gov.uk website, the £65 million support package will be given to councils in England. The councils will determine the best way to support each household on a case-by-case basis. This means you’ll need to contact your local council to access the funds.
The support package will be available throughout the winter months to support low-income earners in rent arrears. It targets households at risk of homelessness due to the impact of the pandemic, especially in the private rented sector.
Payments are more than likely to be paid directly to existing landlords, but if a household is in the process of finding a new home, payments can be made to a new landlord.
How can you avoid accumulating rent arrears in the future?
It’s a good idea to begin by tracking all your incomings and outgoings. You’ll be able to see where you fall short and perhaps make the necessary changes through budgeting. There are also three important questions to consider when assessing your housing situation.
1. Are you living in an affordable area?
If you find that you’re struggling with rent and bills, you might be living in an expensive area. It could be valuable to research the most affordable areas in your locality – and nationally – to determine whether a move would improve your situation.
2. Are you following the rent rule of thumb or the 50/30/20 rule?
The rent rule of thumb recommends spending at most 30%-35% of your income on rent. If you’re spending more than 35% of your income on rent and it’s putting a strain on your finances, then you may need to seek support from your council or consider a move for long-term financial security.
You could try the 50/30/20 rule if you think it would work for you. It recommends spending 50% of your income on your needs (including rent, bills and food), 30% on wants (clothes and hobbies), and the remaining 20% on debt, savings and investments.
3. Are you building an emergency fund?
It’s not uncommon to encounter unexpected emergencies that can drain your savings or even affect your ability to make a living. Having an emergency fund softens the financial blow and helps you avoid payment arrears, including rent arrears.
If the cost of your rent is preventing you from building an emergency fund, then it may be necessary to adjust your household budget or consider a move.
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About the author
Victor is a freelance writer who loves to read and write about personal finance and related disciplines with the aim of educating people to make better financial and investment decisions.
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