Following the announcement about the extension of Rent-flex trials we will be publishing a number of case studies over the remainder of this week which illustrate how tenants in the scheme have used Rent-flex, and the impacts that this has had. Next month we will be publishing the full 12 month evaluation of the pilot with Optivo Housing Association.
Case study 1: Rent-flex can help pay off existing debt and stabilise household finances
A 49 year old female single parent with two children at secondary school joined the Rent-flex scheme in August 2017. She had a history of moving in and out of work, which had resulted in overpayments of Housing Benefit and Council Tax Support. The Council was recovering her Housing Benefit by making deductions from her ongoing entitlement, and she was facing bailiff action in respect of her Council Tax debt. The tenant also had an outstanding loan from Provident, which she had taken out to pay for Christmas presents in December 2016.
“I’d got myself in a bit of pickle, and I’m a bit of a head burier. I was being threatened by bailiffs over the Council Tax and was depressed about it all. I just wasn’t in a very good place. I wasn’t in control. I couldn’t even open the letters.”
As part of the Rent-flex on-boarding process Optivo’s Money Matters Team conducted a home visit to discuss her financial problems.
“The Financial Inclusion Officer from the Money Matters Team was so good. She recognised that there was depression involved, and for that first meeting I was in tears. It felt so hard to admit that I’d got myself into a mess and I didn’t know what to do. Just talking to someone about it all really helped…just knowing that someone cared and that we could find a way through it all.”
Help was given to reduce the rate of the Housing Benefit overpayment recovery, and the tenant was also provided with budgeting tips to cut the cost of her shopping and broadband costs. The Money Matters Team later agreed she could underpay on her rent in November so that she could pay off her Provident loan.
“We went through the options. Since the first visit I’d got a lot better at managing my money. Before, when I was depressed, I couldn’t be bothered to cook properly. I’d always loved cooking, but when you’re depressed it’s just easier to buy frozen food and ready meals, and that can be more expensive.
We sorted out a direct deduction from my wages to pay back the Council Tax and we had a think about what to do about the Provident loan. I decided to take Rent-flex in November 2017 and just pay the loan off, and I also used the scheme to cover the cost of Christmas that year, so I didn’t take on any more debt getting through that. I also underpaid a little bit on the rent the following Easter to help with the extra cost of looking after the kids then.”
The combination of Money Matters support and the Rent-flex scheme have had a positive impact on the rent account, although this has taken some time to feed through. In the year prior to starting on Rent-flex, the tenant’s account was – on average – £170 in arrears each month. Because she was initially in financial difficulties, and chose to underpay on her rent account to pay off the Provident loan, her rent arrears increased over the first half of the year (the outstanding balance rose to £424). However, this marked a turning point and the outstanding balance has since reduced to just £94.
The tenant is now feeling very positive about the Rent-flex scheme and moving forwards would like to manage this using an app on her mobile phone.
“The Rent-flex worked fine for me. I was actually quite shocked about how little extra I would have to pay each month after I underpaid in November. I’ve been paying £480 per month, and that’s been fine… it’s good to know that the flexibility is there if I need it for emergencies.
I’d really like an app, they’re my favourite things. I use one for the electricity now, and it’s just nice to be able to open it up and see the situation; to check things whenever you want to. Anything that makes my life simple is great.”