Government launches Alokaplus, public insurance to cover rent defaults
The Government wants to encourage the release to the market of some 25,000 empty housing units in areas with the highest demand for rent. Insurance will generally cover 14 months of unpaid rent, which can be extended to 20 months in certain cases.
The Basque Government has launched Alokaplus, public and free insurance to protect owners from rent defaults and damage to housing, with the aim of resolving existing doubts about leasing and helping to bring to market some 25,000 empty housing units in areas of high demand.
The programme aims to encourage the rental of more housing, without imposing the cost of private insurance on tenants, for which the Government will assume the outstanding amounts of tenants, provided that the conditions laid down by the programme are met.
What does Alokaplus cover?
The insurance shall apply to natural persons who own up to five dwellings and shall cover unpaid rents, the costs of supply incurred by the owner and the damage caused to the dwelling by fault or negligence on the part of the tenant.
The dwelling must be the habitual residence of the tenant and the rental price must meet the conditions of availability laid down in the programme and the monthly amount covered may not exceed the rent agreed in the contract or the limit set by the reference system of rental prices.
It will cover 14 months of rent in general
As a general rule, Alokaplus insurance shall cover a maximum of 14 months' unpaid rent, which shall be extended to 20 months when the tenant is 35 years of age or younger, over 65 years of age, belongs to a single-parent family or has in his or her care minors or persons with functional or psychological disabilities.
Owners and tenants must sign a commitment document
To access the program, the owner and tenant must sign a commitment document formalizing their adherence to the system.
By means of this document, the tenant shall accept that if the Government pays the owner money for defaults, supply costs or damages covered, it shall then return it to the Administration under the terms established by law.
The measure seeks to increase the supply of rental housing in the areas most in demand and to provide greater guarantees for those who choose to rent housing.
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