Guide for tenants: how to apply for micro loan rental aid during the Coronavirus crisis?

How to apply?

To request a Micro Loan, the tenant will have to fulfill the requirements and present to his own financial institution the documentation required by the Government. This loan will go directly to paying the rent, that is, the beneficiary will not be able to physically dispose of the money.

Interest Free Micro Loans for the purpose of paying the rent are granted through your own bank IF YOU ARE ELIGIBLE. All queries should be addressed to your bank. The following is an unofficial translation intended to highlight key points of the scheme.

What are the conditions that you need to fulfill?

– Applicants must be registered unemployed, have their contracts temporarily suspended (ERTE), have had to reduce their working week due to having to care for someone or other similar circumstance which results in a substantial drop in earnings. The self employed whose earnings have been similarly reduced during the health crisis can also apply .

The family unit in the month preceding the application must:

– Comply with the limit of three times the monthly Public Income Indicator (IPREM), which the Government has set at 537.84 euros per month. That is, in a family unit without children, it would be necessary to earn no more than 1,613.52 euros gross per month (€ 537.84 X3) or what is the same: 19,362.24 euros per year in 12 payments or 22,589.28 euros in 14 payments .

– The limit is increased by 0.1 times for each child or dependent person over 65 who is part of the family unit. i.e. the limit would rise to 1.774,87 euros with one dependent and 1.936,22 euros with 2 for example.

– In the case of one parent families  the increase for dependent children will be 0.15 times the IPREM for each child . Ii.e, 1.855,54 euros per month.

– If any of the members of the family unit are registered with a permanent incapacity of more than 33%, and are unable to work the limit will be 4 times the Iprem (2.151,36 euros gross per month)

  • The amount of the rent plus basic utilities (electricity, gas, diesel for heating , running water, telecommunications and community fees) Have to make up at least 35% of the net income of the family unit.

Owners of any property in Spain are not eligible even if they are renting elsewhere. With the exception that they only part own a property due to inheritance, or are denied use of the owned property in the case of separation or divorce for example.

What Documentation is required?

If after having read the requirements you have a valid claim then you need to substantiate your situation with the following documents:

– Legal Situation of Unemployment: a certificate emitted by the authority that pays your benefit in which the amount of unemployment benefit or subsidy is shown.

–  Self Employed Termination of employment cese de actividad “: certificate issued by the Agencia Estatal de la Administración Tributaria tax office or the Comunidad Autónoma tax office , showing the base of the calculation .

– Regarding the number of persons living in the habitual residence it is necessary to present a family book ( libro de familia) or other document accrediting legally registered common law couple, or an up to date certificate of empadronamiento showing those registered at the same address currently and for the previous 6 months. If applicable a certificate of disability or permanent incapacity.

– Ownership of property – provide a nota simple obtainable from the Registro de la Propiedad for each member of the family unit to show they do not own any residential property.

– A  signed declaration by the applicant or applicants regarding the fulfillment of the requirements required to be considered to be without sufficient financial resources

In addition, according to the royal decree-law, tenants who cannot provide any of the documents that accredit them as being in a legal situation of unemployment or not in ownership of a home can replace them for the time being with a signed statement that justifies the reasons, related to the consequences of the COVID-19 crisis. After the end of the state of emergency and its extensions, they will have a month to submit said documents.

Where are the documents obtained?

The state employment service (SEPE) have published instructions to obtain a certificate that accredits personal circumstances :

– Go to Sede Electrónica del SEPE and select “Obtenga un certificado sobre su prestación”.

– This can be done with a Digital Certificate, an electronic DNI electrónico or cl@ve or option “Pin Teléfono Móvil”.

– Select “certificado de prestación actual”.

SEPE advises if you do not have a mobile telephone or internet you can apply by land line and the certificate will be posted to you.

What other assistance is available?

If you can fulfill all the above requirements:

– Suspend Evictions. to those with no other living alternative, up to 6 months after the end of the state of Emergency.

 Extraordinary extension of rental contracts. Extraordinary and automatic extension of six months in the leases of habitual residence that would expire during the special measures of confinement due to the health crisis. The terms and conditions established for the contract will be maintained, so the owner will not be able to raise the rent.

– Interest free Microloans. (see conditions above) The Government together with the ICO has approved a line of guarantees and microcredits without charges or interests that can be repaid over 6 years, expandable to 10. These grants must be used entirely for the payment of rent, and may cover a maximum amount of six monthly payments. In addition, for those tenants who still cannot afford their rent, they will have direct State aid to pay off their debt (up to 900 euros a month and 200 euros of supplies and maintenance).