Landlord emergency loan scheme details announced

The Scottish Government has now revealed the details and eligibility criteria for its PRS Landlord (non-business) Covid19 Loan Support scheme.

The scheme opened for applications today (5 May 2020) and the link to apply was emailed to all SAL members.

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More about the landlord loans:
Although this is a repayable loan and not the grant funding SAL would have preferred to see, it is better than nothing for those in need. What SAL has secured here is better than our English landlord colleagues can access – to date they have no access at all to any government support.   

SAL is aware that some members may be surprised and indeed disappointed to learn that the loan scheme is only open to landlords of five or fewer properties. Additionally, they can apply for the loan for only one property within their portfolio, even where more than one property has a COVID-19 related loss.

SAL has successfully lobbied the government to increase the loan to 100% of lost income for the single property, this was following early proposals for an 80% cap. SAL also pressed successfully for landlords of five properties to be included in the scheme when early drafts appeared to include those owning only three properties or fewer.  

The government’s rationale is based on the fact that 95% of Scottish landlords own between one and five properties. They consider that landlords with more than five properties are more able to spread the risk of non-payment of rent over the larger portfolio and are less likely to require a loan. (see data source).

SAL recognises and appreciates that the loan will be a lifeline for those landlords who fit the criteria and have no other options.

It is a welcome first step, however SAL believes the scheme should be opened up to help ALL landlords regardless of portfolio size, who are dependent on rental income and who face financial losses where tenants cannot pay or properties are unable to be let due to the COVID-19 crisis.

Without support, landlords will be forced into difficult decisions on disobeying lockdown guidance over viewings and move ins or losing their business, thus removing essential housing from an already short supply.

SAL continues to make several points to the Scottish Government: 

1. The loan scheme is welcome but needs to go further.

2. Landlords are being unfairly penalised at a time when other small businesses and self-employed people have been supported with grants to save their businesses.

3. Landlords of any portfolio size should have access to the scheme.

4. Loans should be available for more than one property where rent has been lost due to COVID-19.

5. There is little recognition for the fact that landlords are taxpayers and provide much needed homes for people to live in, in some cases for the most vulnerable in society.