She's a great tenant, but how to deal with her covid-related rent arrears?

My tenant moved into my rental property with two of her grown children in 2016. They were model tenants until covid hit, which coincided with her daughter moving out, and my 60-year-old tenant losing her job.
When she told me she was having problems paying rent, I advised her to apply for benefits, which she did, but they did not cover the full rent, so, in 13 months, she has racked up rent arrears of £3,600.
She’s now more than eight weeks in arrears, and we have agreed a payment plan. She has agreed to pay the full rent from 1 May, and to pay £100 a month extra from 1 June in arrears. I agreed to waive £500 of the arrears if she stuck to the plan.
The 3-bed house is modest but in a great location. The rent has been £1425pm for three years now. Similar properties in the area rent for £1.5-1.6k, but my property needs to be rented to a family, otherwise it would be an HMO (policy introduced in 2016).
I am wondering if the payment plan I have agreed with my tenant is viable, since she also recently told me that her son has now moved out, and if she has no one to help her pay, she may scarper if she feels unable to? And I no longer have any security against that. She’s currently on a periodic tenancy. Her son is still on the contract so I need to draw a new one up. How can I best protect myself, be fair to my tenant, and recover the money?

If her children have now left home as far as the Housing Benefit are concerned she is over accommodated so will only pay for whatever the Local Authority Allowance is for a one bed property. You could look it up on your Council’s website. Not sure if the bedroom tax is still being charged. Might be an idea to check this out too as not only will the housing benefit be reduced to that of one person, they may well deduct from her allowance for the two extra bedrooms.
If so, you, or she, may decide that it is not viable to keep her in the property.

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Mr T that is a very good point. She needs to look for a smaller place

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Gothard Rowe may be able to help in this situation or find benefits she may be entitled to
They can recoup arrears from charities etc or advise if the plan is viable

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In view of her age if she has a private pension she could draw down some of that to clear the arrears, but unlikely a landlord has any way of knowing this and a tenant would probably be unwilling to discuss or disclose.
Depends how well you get on and how willing she is to work with you in trying to sort the situation out.
The Council have a Discretionary Payment Fund so she could apply to this to see if they would contribute any more towards her rent shortfall.
As well as the above company mentioned, the CAB, Money Advise Service and various other organisations will look at her benefits to see if there is anything else she is entitled to.
Even if she got another job, would the salary be enough to cover the rent by herself in the future?

Another thought. If she cannot pay the full rent now what is changing for her in May and June when she has agreed to pay the full rent, plus arrears?
Perhaps Colin3 is right that she needs somewhere smaller and will hopefully continue to clear her debt with you.