If you’ve been impacted by coronavirus, whether it’s because you’ve lost some or all of your income, or your household bills have increased, it’s important to know what you can do to help with your debt and money worries.

Rent and mortgage

I can't afford to pay my rent 

Talk to your landlord as soon as possible, even if you haven’t missed a payment yet but are worried you might. Let them know how you’re affected and explore your options.

If you’re facing financial difficulty and are unable to pay your rent because of coronavirus, landlords (both private and social) in Scotland now have to give tenants up to six months’ notice, increased from six weeks. This measure is intended to help those affected seek help e.g. applying for benefits and support.

While this extended notice period of six months will apply in most cases, if the landlord requires to move into the property themselves or has to evict a tenant due to anti-social or criminal activity, the period is three months.

How do I get a mortgage holiday if I’m affected by coronavirus?

Mortgage lenders have announced support for those whose finances have been affected by coronavirus, such as a repayment holiday. You will need to speak with your lender to find out if they will be able to offer you this, or any other form of support, based on your personal circumstances. To arrange a mortgage payment holiday, you need to have agreed this with your lender by 31 October. 

It’s important to note that during a payment holiday, interest will continue to build and monthly payments may increase afterwards to repay the missed payments which means you may end up paying more in the long run, so if you can afford to continue making payments you should do so.

You can visit the Money Advice Service website here for more information, including links to mortgage lender support pages.

My mortgage payment holiday is coming to an end, what will happen?

If you’re coming to the end of a payment holiday as agreed with your mortgage lender there are a few options for what can happen next. Your lender will be in touch as the end of the payment holiday approaches. 

  • Starting to make payments again

If you’re able to do so, you can start to make payments towards your mortgage again. Your lender will work with you to find the best way to catch up with missed payments.

 

  • Reduced payments for another 3 months

If at the end of your payment holiday you are not yet able to start making payments in full, your lender should work with you to find out what you can afford to pay and allow you to make reduced payments for another 3 months. This must be confirmed by 31 October and would last until 31 January 2021, after which time alternative measures of support can be offered by mortgage lenders. 

 

  • More support and a possible extension to the payment holiday

If you can’t yet afford to make any payments towards your mortgage at the end of the payment holiday, your lender should offer you more support which may include a further 3-month payment holiday. The support considered by your lender will depend on individual circumstances, so you should speak to your lender as soon as possible. While a payment holiday agreed with your lender will not have a negative effect on your credit report, other forms of support might and your lender should let you know if this is the case.

It's important to note that any further support after a payment breaks own can be recorded on your credit file. 

Household bills and utilities 

I can't afford to pay my council tax because my income is affected 

If you are likely to miss a council tax payment, you should let the council know as soon as possible. Councils are offering payment breaks for people affected by coronavirus, but the each council has their own policy on this and payment breaks can only happen once agreed with the council, so if you're worried about making council tax payments you should speak to your council as soon as possible. 

You may also be eligible for a reduction in council tax payment if your income has been affected. Use Citizens Advice Scotland’s online calculator to check if you can save money on your council tax bill. 

I can’t afford to pay household bills because my income is affected

Talk to your service providers as soon as possible to see what they can do for you. Many companies are offering ways to reduce payments or ‘pause’ non-essential services to help people during this time. You’ll find useful information to help you on the Money Advice Service website.

I have no money to pay for essentials and need money urgently 

Crisis Grants are available to those on a low income or benefit-only income who need money for essentials quickly. You can apply for a Crisis Grant on your council’s website, usually online or by phone.

To find details of how to apply to your local council for a Crisis Grant, visit this website and select your council from the drop-down menu. Decisions are usually made within 24-48 hours but may be longer due to current circumstances.

For those applying for Universal Credit

If you’re going to be applying for Universal Credit (UC), you may be able to get an advanced payment. The amount you get is the estimated amount of your first payment which is dependent on your personal circumstances. An advanced payment is a loan so your following UC payments will include deductions to make up for the amount you received as an advance.

The Scottish Government has also announced a new Self-Isolation Support Grant for people who would face financial hardship if asked to self-isolate. Find out more about this by visiting the Scottish Government website

Credit and debt

Can I get a payment freeze for my credit card or loan?

Measures from the FCA mean that credit card and loan customers will be able to access a temporary payment freeze for up to three months. Personal loans also include guarantor loans, logbook loans and home collected credit. The deadline for arranging this is 31 October 2020. 

This means you may be able to make no (or small token) payments for 3 months. This won’t affect your credit file for the period of the payment freeze. However, interest will continue to build during this period, meaning you may pay higher costs in the longer term. 

If you can afford to keep up repayments, either in full or a smaller sum, then you should do so.

Your lender may offer you alternative temporary relief - for example, where a high rate of interest would accrue during the payment freeze period leading to longer-term financial difficulty.

You will be able to request help under these measures for a period of 3 months – and these will apply for a period of 3 months from when you agree them with your lender.

You need to contact your lender to have this approved before you stop or reduce payments.

What can I do if I am still experiencing financial difficulty at the end of the payment freeze?

Payment freezes are intended to provide short-term financial relief if you have been affected by coronavirus; however, in some cases you may end up paying more in the long run. If you have longer-term or other financial worries, there may be other options that are more appropriate for you.

Firms must consider how they can help customers with longer-term financial problems, and so you should contact your lender as soon as possible to discuss what options are available.

If you are not able to restart repayments at the end of this period, firms are expected to provide what is known as ‘forbearance’. This could include waiving the interest that has built up during the payment freeze period. 

Forbearance normally means arranging other ways to pay your debts, which could possibly include debt forgiveness. However, it’s important to know that this may affect your credit file and it could lead to your lender freezing access to your credit.

You should contact your lender as soon as possible to discuss what is best for you. 

It should be noted that any additional support received after a payment freeze may be reflected on your credit file. 

I can’t afford to continue paying my PCP (personal contract purchase) or PCH (personal contract hire) car agreement. What should I do?

If you’re having trouble making PCP or PCH payments for vehicle, you can apply for a 3-month payment break from your motor finance provider.

Motor finance firms should not alter aspects of customers’ Personal Contract Purchase (PCP) or Personal Contract Hire (PCH) agreement in a way that is unfair or take steps to end the agreement or repossess the vehicle.

If you want to keep your vehicle at the end of the agreement but do not have the money to cover the outstanding balance due to coronavirus-related temporary financial difficulties, firms should work with you to find a solution.

To find out what is best for you, you should contact your motor finance provider as soon as possible. Do not stop or reduce payments until you have spoken to your provider. It is also important to note that while a payment break is intended to offer to short-term financial relief, it can result in you paying more in the future.

I am having difficulty repaying a payday loan due to coronavirus

If you are finding it difficult to make repayments because of coronavirus, you can request a 1-month freeze. Unlike payment freezes for other credit products, payday lenders are not allowed to charge interest during this 1-month period. However, you will have to resume payments in full and will still owe the outstanding balance when the payment freeze period comes to an end.

If you want to request this payment freeze, you should contact your lender (and no not stop making payments until you have done so).

Are there any measures in place regarding overdrafts?

If you have an arranged overdraft

You can ask the provider of your main current account for up to £500 of overdraft borrowing with no interest for 3 months.  Some providers have already announced they will provide interest-free overdraft facilities. To find out what your bank or building society is doing check their website.

If your current arranged overdraft is below £500

You will not pay any interest on the amount of your current overdraft limit. 

If you don’t have an overdraft, or your limit is smaller than £500

You can request a new overdraft or an increased limit. This will be subject to normal checks on affordability. 

If your current arranged overdraft limit is more than £500

Firms are only required to provide up to £500 interest free. 

You will be able to request help for a period of 3 months – and these measures will apply for a period of 3 months from when you agree them with your lender. However, if a firm chooses to offer an interest free amount to all its arranged overdraft customers, then this may be offered for the same fixed period for all customers – and no less than 3 months.

I can't afford to pay my debt because my income is affected by coronavirus 

Talk to your lender as soon as possible to see what they can do for you. It’s best to do this ahead of missing payments where possible. Let them know how you’re affected and see if they can suspend payments or what else they can offer to make things more manageable. You’ll find useful information to help you on the Money Advice Service website.

You’re also welcome to use our confidential benefits calculator to check your entitlement if your income has been affected by coronavirus.

If you have a question about debt, you can use our webchat service to talk to an adviser. Just click on the purple icon on the bottom right-hand corner of this page. Advisers are available Monday to Thursday 8:30am to 6pm, Friday 8:30am to 3:30pm. Please note we’re closed on public and bank holidays.

I’ve been offered a credit product/credit limit increase to help with financial difficulty as a result of coronavirus

Many lenders are offering temporary ways to support people during this time like offering credit limit increases and relaxing their eligibility criteria for some credit products.

It’s important to explore all your options on how to increase or maximise your income before accessing credit. What lenders offer and how this will impact your credit score depends on a lot of things.

Talking to your existing lenders and providers about what help they can offer to lower monthly payments is a good idea – anything to help make things more manageable at this time. There is useful information about borrowing on the Money Advice Service website.

You’re also welcome to use our confidential benefits calculator to check your entitlement if your income has been affected by coronavirus.

Can a creditor take action against me if I can’t afford payments because of coronavirus?

New legislation implemented by the Scottish Government has extended the moratorium period for people in debt from six weeks to six months. This means that creditors can’t take debt recovery action against an individual or a firm for six months and the limit of one moratorium period per year has been overturned. This is to ensure that people in debt have appropriate breathing space during this uncertain time. Moratorium applications can continue to be submitted electronically here

Our advisers can help explain what this means for you. Just click on the purple icon on the bottom right-hand corner of this page. Advisers are available Monday to Thursday 8:30am to 6pm, Friday 8:30am to 3:30pm. Please note we’re closed on public and bank holidays.

Will my credit score be negatively affected if I miss payments because of Coronavirus?

The three main UK credit reference agencies (Experian, Equifax and TransUnion) have agreed that a temporary payment holiday with a lender will not affect consumers’ credit reports. This will apply to mortgages, credit cards, and other unsecured loans.

This means that if you are making reduced payments (as agreed with the lender) or using a payment break, there will be no negative impacts on your credit score. However, other measures of support your lender may offer you might have a negative effect on your credit score, and if this is the case they should let you know.

It is important to note that for payment breaks/reduced payments to not show on your credit report, they must be approved by your lender in order to become “authorised changes”. If not approved by your lender, these changes will be shown as “unauthorised” and will negatively affect your credit score.

After 31 October, normal credit reporting will resume and any new support offered by lenders may be reflected in your credit file. Your lender is expected to tell you how any support you receive will affect your credit file. 

Benefits

I already receive benefits/tax credits. Will this be affected by coronavirus?

You should receive your benefits/tax credits as normal. If your circumstances have changed because of coronavirus – this includes loss of earnings in the household, or you’re sick or self-isolating – you should report a change in your circumstances. If you get Universal Credit (UC) you can do this online by signing into your UC account or contacting your work coach. For other benefits, you can check how to report a change by visiting the GOV.UK website and searching for the relevant benefit.

If you need help finding contact details, you can use our webchat service to talk to an adviser. Just click on the purple icon on the bottom right-hand corner of this page. Advisers are available Monday to Thursday 8:30am to 6pm, Friday 8:30am to 3:30pm. Please note we’re closed on public and bank holidays.

Can I claim benefits if I am furloughed?

If being furloughed reduces your income, you may be eligible for Universal Credit. If you’re eligible, the earnings you receive while on furlough will be treated like any other earnings and may affect how much UC you can receive. It is also important to note that if you are currently receiving tax credits or any of the benefits that are replaced by UC, this will stop (and cannot be restarted) if you apply for UC.

Applying for UC will have no effect on your employer.

 

Use our confidential benefits calculator to find out if you are eligible.

Do I have to attend face-to-face appointments for a new or existing benefit claim?

The government has suspended face-to-face appointments for three months with effect from Thursday 19 March. Instead, you’ll need to contact your local Jobcentre to speak with an adviser who will organise a telephone interview to take place at a later date.

You can keep up to date with information and changes to this guidance by visiting the GOV.UK website.

I am paying back a benefits overpayment. Will this be affected?

Recovery of benefit overpayments will be temporary suspended for three months. This applies to all benefit-related overpayments including universal credit, social fund loans and tax credit; however, recovery of universal credit advances will continue. Local authorities will also halt referrals of housing benefit overpayments.

Most of these payments will be suspended automatically if you are repaying through a direct reduction from ongoing benefits or by a Direct Earnings Attachment. If you are repaying through a bank standing order, bank giro credit, or online banking, you will need to contact your bank to cancel the arrangement.

I have an upcoming medical assessment

The Department of Work and Pensions (DWP) has suspended all face-to-face assessments. If you had an upcoming appointment for a new claim, you should expect to receive a letter or phone call to tell you what the next steps will be. If you had an upcoming assessment as part of an existing claim, you’ll continue to receive payments as normal.

Employment

I’ve lost some or all the income I was receiving through employment

The Job Retention Scheme (also referred to as furlough) will finish on 31 October 2020. A new scheme, the Job Support Scheme, will take its place in offering support for employees of businesses affected by Covid-19. The scheme will open on 1 November 2020 and run for 6 months, ending in May 2021.

To be eligible, you must work at least a third of your normal hours, which will be paid for by your employer as normal. The hours not worked will be subsidised by the government and your employer, each paying a third of the remaining hours. The amount the government will pay is subject to a cap of £679.92 per employee each month.

You do not need to have been furloughed previously to be eligible.

It is important to note that your employer cannot make you redundant or put you on notice of redundancy during the period in which they are accessing the Job Support Scheme.

You should also check your benefit entitlement to see what you’re eligible for and apply as soon as possible. For people who are not sick or self-isolating, Universal Credit (UC) will most likely be the benefit that replaces lost income. You can use our confidential benefit calculator to check your entitlement here.

If you have a question about how and where to apply for a benefit, you can use our webchat service to talk to an adviser. Just click on the purple icon on the bottom right-hand corner of this page. Advisers are available Monday to Thursday 8:30am to 6pm, Friday 8:30am to 3:30pm. Please note we’re closed on public and bank holidays.

I’m self-employed and have suffered a loss in income. What support is available?

Self-employed workers can also apply for support under certain circumstances. The Government’s Coronavirus Self-employment Income Support Scheme provides a taxable grant equivalent to 80% of profits up to a cap of £2,500 per month.

This scheme will be extended, with those eligible to receive a further and final grant of up to £6,570 in August.

The grant will be worth 70% of average monthly trading profits, and will be paid in a single instalment covering three months’ worth of profits, capped at £6,570 in total.

More information on eligibility is available here.

The Government has also announced a six-month suspension of tax payments through the self-assessment system to support people who are self-employed.

The Government has launched a small business loan scheme - known as a Bounce Back Loan. To find out if you're eligible and to apply, visit the GOV.UK website.

I’m employed but self-isolating

If you’re unable to work because you have coronavirus or are self-isolating, talk to your line manager or HR person as soon as possible to make them aware of your situation. If you’re not entitled to sick pay through your employer, you may be eligible for Statutory Sick Pay (SSP). You can check your eligibility for Statutory Sick Pay on the GOV.UK website. 

Please note for those that are eligible for SSP and have coronavirus or are self-isolating based on NHS 111 advice, you will be paid SSP from day one rather than day four.

The Scottish Government has announced a new Self-Isolation Support grant for people who may face financial hardship if asked to self-isolate, e.g. if unable to work from home. To find out more, visit the Scottish Government website.

I'm self-isolating but am not entitled to Statutory Sick Pay (SSP)

If you’re not eligible for Statutory Sick Pay (SSP), you can claim Universal Credit (UC) which helps with living costs and/or ‘new style’ Employment and Support Allowance (ESA) which is specifically aimed at those who are sick or self-isolating and cannot work. You can use our confidential benefit calculator to check your entitlement here. 

You can also find useful information on claiming benefits and Statutory Sick Pay (SSP) in relation to coronavirus here.

If you have a question about how and where to apply for a benefit, you can use our webchat service to talk to an adviser. Just click on the purple icon on the bottom right-hand corner of this page. Advisers are available Monday to Thursday 8:30am to 6pm, Friday 8:30am to 3:30pm. Please note we’re closed on public and bank holidays.

My employer won't give me sick pay

Free and impartial information and advice can be accessed through ACAS. They help employers and employees with all aspects of workplace relations and employment law. You can visit their website for information relating to issues caused by coronavirus or call the ACAS helpline on 0300 123 1100, open weekdays 8am to 6pm.

General advice

Keep checking your local council website for updates on services or actions being taken at a local level to support residents. Also keep an eye on the GOV.UK website where you’ll find information about SSP, benefits, some employee rights and employer guidance.