Rent arrears - assured and short assured tenancies

This section looks at the grounds for possession for rent arrears in assured and short assured tenancies.

This content applies to Scotland

Grounds for recovery relating to rent arrears

There are three grounds for recovery of possession of assured and short assured tenancies which relate to rent arrears. [1]

Ground 8

If the landlord is relying on ground 8 to obtain possession of a property, rent lawfully due from the tenant must be in arrears for at least three months. The arrears must exist both at the time the notice of proceedings for possession is served on the tenant and when the case is heard in court.

Ground 8 is a mandatory ground, where if it is proven the tribunal must grant decree and cannot consider reasonableness. However, since 2 July 2004 [2] it is possible that this ground may not be satisfied where the arrears are the result of problems with housing benefit payments.

Where notice was served on or after 7 April 2020 see the section below on Coronavirus measures.

Tactics when recovery is sought on ground 8

If the arrears are of rent lawfully due and there is no other defence regarding the procedural requirements or housing benefit payment problems then the only option may be for the adviser to help the tenant get the arrears under three months.

Local authorities have a duty to prevent homelessness. It may be appropriate to suggest that it exercise its powers under The Children (Scotland) Act 1995 [3] or the Social Work (Scotland) Act 1968 [4] to offer cash to enable the rent arrears to be reduced to less than three months.

If the arrears are due to problems with payment of housing benefit, advisers should remind the local authority of its legal obligation to make a payment of housing benefit within 14 days, or as soon as possible if this is not reasonably practical. [5] Since 2 July 2004, provided the delay or failure to pay housing benefit was not the fault of the tenant, the sheriff has the discretion not to make an order under ground 8 unless it would be reasonable to do so. [6]

Advisers should always seek expert advice in ground 8 cases and a referral to a solicitor with expertise in housing law would be appropriate in such cases.

Ground 11

Ground 11 is a discretionary ground. The tribunal may grant the landlord possession if the tenant has 'persistently delayed' in paying rent, even if there are no arrears at the time the landlord begins possession proceedings. For a landlord to succeed on this ground 'it would appear likely that some degree of deliberate delay, repeated on a number of occasions, is required'. [7] Since 2 July 2004, in considering whether or not it is reasonable to make an order under this ground, the sheriff must take account of any delay or failure in payment of rent caused by problems with housing benefit payments

Ground 12

Ground 12 is a discretionary ground. This ground applies to situations where some rent lawfully due from the tenant is unpaid on the date on which proceedings are begun, and was in arrears at the date of service of the notice of proceedings for recovery of possession.

The requirement to take account of delays or failures in payment of housing benefit outlined in ground 11 also applies in ground 12. [8]

For more information on the procedural requirements if a landlord is seeking possession of an assured tenancy, please see the section on assured tenancies.

Coronavirus (Scotland) Act 2020

In all cases where notice was served on or after 7 April 2020  there are longer notice periods for rent arrears (six months) and all grounds, including Ground 8 become discretionary. [9]

See the page Landlord wants possession of an assured tenancy for full details.

Tenant hardship grant and loan funds

The Scottish Government has introduced a tenant hardship grant fund and loan fund. These are for tenants who have had their finances impacted by the COVID-19 pandemic and do not have other means of support.

The grant fund

Tenants can apply for a grant through their local council’s homeless prevention team. The grant does not need to be paid back. The grant fund will be more suitable for tenants than the loan fund where the tenant is on a low income and would not be able to pay the loan back.

Criteria:

The grant fund is available for:

  • social tenants

  • private tenants

  • tenants of student accommodation.

People with no recourse to public funds will not be able to access the fund. The grant can cover arrears accrued between 23 March 2020 and 9 August 2021. Rent arrears built up after 9 August 2021 will only be covered by the grant fund in exceptional circumstances. The grant can cover all of a tenant’s arrears or a proportion of them. This is down to the discretion of the homeless prevention team. If an award is made for a proportion of the arrears then the council should work with the tenant and the landlord to establish a repayment plan for the rest of the arrears. The grant is paid directly to the landlord, so as not to affect any benefit entitlement of a tenant. Any private landlord receiving a grant fund payment must be registered with their local council.

Protection against eviction:

Any landlord evicting a tenant over rent arrears needs to follow the pre-action requirements both in the social rented sector and in the private rent sector. It is expected that councils will want to see evidence the landlord has followed other pre-action requirements before awarding a grant payment. Landlords will also need to agree not to start or proceed with any repossession action to receive a grant payment. When preparing a defence at a tribunal, advisers should note where:

  • a landlord has failed to signpost to the grant fund or

  • refused to accept a grant fund payment

The loan fund

The loan is administered by the Scottish Government, and can be applied for through the tenant hardship loan fund website.

Criteria:

Loans are available for social and private tenants. People with no recourse to public funds will not be able to access the fund.

Fund details:

  • the loan can pay up to a maximum of 9 months’ rent costs covering rent arrears and future rent

  • it can cover arrears which have arisen since 1 January 2020

  • it can include up to a maximum of 3 months of future rent payments as part of the 9 month total

  • the loan is interest free

Loan repayments will be deferred for 6 months and repaid over 60 months. The loan fund will be subject to an affordability assessment to check whether the applicant has enough surplus income after costs to make the loan repayments. Applicants are advised to seek money advice to ensure that the loan is suitable for them. The application process for the loan highlights that there may be other more appropriate financial support options available to tenants. The loan fund will signpost people to sources of advice and support before accepting an application. More information can be found in Tenant's Hardship Loan - Information for advice providers.

Protection against eviction:

For a tenant to receive the loan private landlords will have to agree not to repossess a property on certain eviction grounds. These grounds are:

  • rent arrears

  • the landlord or their family member intend to live in the let property

  • the landlord intends to sell the let property

  • the landlord intends to use the let property for a purpose other than housing

Any action to end a tenancy on these grounds that has already been started will also need to be withdrawn.

Private sector rent arrears pre-action requirements

The Coronavirus legislation introduced a requirement that, when considering reasonableness, the tribunal must consider to what extent the landlord has complied with certain pre-action requirements. [10]

You can see details of these on the page Private sector rent arrears - pre-action requirements.

Last updated: 27 September 2021

Footnotes

  • [1]

    sch.5 Housing (Scotland) Act 1988 as amended by s.12 Homelessness etc. (Scotland) Act 2003

  • [2]

    s.12 Homelessness etc. (Scotland) Act 2003

  • [3]

    s.22 Children (Scotland) Act 1995

  • [4]

    s.12 Social Work (Scotland) Act 1968

  • [5]

    reg. 91 Housing Benefit Regulations 2006

  • [6]

    s.18(3A) Housing (Scotland) Act 1988 as amended by s.12 Homelessness etc. (Scotland) Act 2003

  • [7]

    Mitchell J, 'Eviction and Rent Arrears', Shelter, para 5.20

  • [8]

    s.18(4A) Housing (Scotland) Act 1988 as amended by s.12 Homelessness etc. (Scotland) Act 2003

  • [9]

    sch.1 Coronavirus (Scotland) Act 2020

  • [10]

    para. 5 and 6 The Rent Arrears Pre-Action Requirements (Coronavirus) (Scotland) Regulations 2020 SSI