Tenants facing eviction in Vancouver because they can't pay the rent will soon have a lifeline with the establishment of the city's first rent bank.
The bank will provide interest-free loans in the $500-to -$800 range to applicants facing imminent eviction, said Vision Vancouver Coun. Kerry Jang, adding that this will be an important measure to prevent homelessness.
An undisclosed amount of seed funding is being provided by Fiore Financial Corp. president and CEO Frank Giustra, and Jang said he expects this will cover the bulk of the bank's operating costs. Details are still being finalized and it's too early to say whether the city will provide any funding, Jang added.
There is already a rent bank operating in Surrey and Jang said data from jurisdictions throughout North America suggest the loan repayment rate is 75 per cent or better.
"Most of the people who use the rent bank are people who are working, but have to make the choice between feeding the kids, paying the rent or paying the hydro," Jang explained.
The bank also will help people working minimum-wage jobs who want to find a nicer place to live, but can't afford the damage deposit on top of the rent, he added.
There will be a limit to the number of times the same person can apply for funding; Jang suggested something in the order of once every two years.
The goal is to get the bank up and running by the first quarter of 2012, said Dick Vollet, president and CEO of the Streetohome Foundation, which is providing the loan money on behalf of Giustra, a founding board member. Streetohome and the city are in the midst of identifying a non-profit organization to run the bank, Vollet said. Surrey's rent bank is run by the non-profit Newton Advocacy Group, and has been in operation since March 2010.
In that time, it has administered 76 loans averaging just over $800, rent bank team leader Judy Peterson said. The loans helped keep roughly 200 people in stable housing, she added.
Surrey Rent Bank's goal is to achieve 71-per-cent repayment, but the rate is closer to the mid-60s, Peterson said. The majority of the bank's clients are women and most have families. The bulk of them also have a Grade 12 education or higher, Peterson said, emphasizing that the bank only gives loans to people who have no other alternatives, such as EI. The number of people who would use such a service is difficult to pinpoint, but Streetohome's Vollet noted that rental housing options in Vancouver are limited and expensive. The rent bank is designed to help those most at risk of becoming homeless, he explained, and this is why Giustra decided to become involved.
"We need to be creative and imaginative in our solutions towards preventing homelessness," Giustra said in a statement. "I believe the concept of rent banks will be just one of these solutions, that will complement other initiatives. Streetohome is working on this new model, and I am committed to supporting it."
By Tara Carman, Vancouver Sun
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