19 January 2007
Housing associations are cutting rent arrears by persuading tenants with debts to avoid doorstep lenders, a new report says.
Landlords are benefiting by giving tenants more access to cheap loan schemes and other financial services, according to the Salford University report.
Rent arrears at North Devon Homes fell from 5.7% to 1.9% in just over 12 months after it helped tenants to borrow through credit unions.
Previously, some households were paying moneylenders more than half of the money they received each week in benefits.
Community access to money, published on January 11, says social landlords have been left on the front line in deprived communities following the closure of banks and post offices.
But there is a strong business case for improving personal finance if it reduces the threat of eviction. 'It can mean that landlords spend less on dealing with arrears, fewer people have to move and less costs are incurred in letting homes,' says the report.
Places for People, England's largest housing association, offers its own mortgages through the Co-op Bank, while other associations are part of community financial initiatives or offer debt advice services.
The National Housing Federation, which already offers home contents insurance to tenants, is exploring the potential for other financial products as part of an initiative with the Royal Bank of Scotland Group.
PFjan2007
