Government Mortage Rescue Scheme Rolled Out

By January 16, 2009House Repossession

Today the government launched their £200 million mortgage rescue scheme designed to help thousands of people who are struggling to avoid house repossession in England.

The mortgage rescue scheme has been set up so that mortgagees can reduce their monthly mortgage repayments, hence avoiding house repossession.

Under the scheme home owners have 2 choices:

  • They can receive a loan from a non profit housing association. Then they can pay back the loan when the economy improves.
  • Or they can sell their home to a non profit housing association and rent back their home at subsidised rent. The property will be valued by an independent surveyor, so they will be paid the market value for their house.

However their is a catch, the home owner must meet strict criteria to qualify for the scheme

  • You must be a family with dependent children.
  • Or a family who are looking after a disabled, elderly or vulnerable person. We are not actually shore what they mean by “vulnerable”.
  • Your household income must be less than £60,000 per year.

The Department for Communities and Local Government believe that up to 6000 households will be able to avoid house repossession as a direct result of this scheme. They predict that 75,000 home owners will loose their home in 2009. So this scheme will help 8% of homeowners who are facing house repossession in 2009. However this is part of the larger scheme to help home owners avoid house repossession.

Most of the schemes appear to be designed to help families, rather than home owners who are single. Do you think the government are being biased with their support?

Join the discussion One Comment

  • Mortgage Broker says:

    Currently mortgage rates and products change daily so I would always recommend any homeowners to discuss their requirements with an independent Mortgage broker as they will have their finger on the pulse with regards to the changing market.

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