Mortgage Rescue Scheme helps only two households

| June 3, 2009 | 0 Comments
Mortgage Rescue Scheme helps only two households

A Government scheme to aid families in England under threat of repossession has helped only two households since its launch in January.

According to the Department for Communities and Local Government (DCLG), the £285 million package of measures is “designed to prevent some of the most vulnerable families losing their homes and experiencing the trauma of repossession”.

It is supposed to bring together local authorities, Registered Social Landlords (RSL), lenders and debt advice agencies to provide two elements:

Shared equity, whereby the RSL provides an equity loan enabling the householders’ mortgage repayments to be reduced.

Government Mortgage to Rent, whereby the RSL clears the secured debt completely and the applicant pays rent to the RSL at a level they can afford.

According to figures from the DCLG, 1,084 households approached local authorities with mortgage difficulties in April.

Of these 1,084 households, 452 were deemed to be at risk of repossession and in a “priority need category”.

One hundred and thirty nine completed an application to the Mortgage Rescue Scheme during the month.

However, only one household was successful, doubling the number of families to have benefited from the scheme so far.

Latest data from the Council of Mortgage Lenders shows that repossessions by first-charge mortgage lenders stood at 12,800 during the first quarter of 2009.

The figure compares with 10,400 repossessions in the final quarter of 2008, and 8,500 a year earlier.

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