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Scottish government introduces new interest-free loans for landlords whose tenants are struggling to pay rent

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16 May 2020

Scottish government

Landlords in Scotland whose tenants are unable to make their full rental payment amid the coronavirus crisis can apply for an interest-free loan, the Scottish government has announced.


The Private Rented Sector Landlord Covid-19 Loan Scheme was opened on Tuesday for applications, allowing eligible landlords to receive 100% of their lost rental income on a single property.


To be eligible, landlords must not be classed as businesses, have five or fewer rental properties and can prove their tenants have been unable to pay rent because of the Covid-19 pandemic.


The scheme is very much a last resort for landlords, the government advised. Landlords must have drawn up a plan with their tenant to help them pay back rent arrears before applying. The application process will require landlords to confirm they understand the current eviction proceedings under the Coronavirus (Scotland) Act 2020.


Landlords are also expected to seek a mortgage repayment holiday from their lender before they apply for a loan.


Scotland's Housing minister Kevin Stewart said: “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.”


John Blackwood, chief executive of the Scottish Association of Landlords, commented: “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.”

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