Mortgage Rescue Scheme

mortgage rescue

The Government now has a £200m package of measures designed to prevent some of the most vulnerable families losing their homes due to repossession. The government scheme subject to a range of eligibility criteria is aimed at households who are eligible for homelessness assistance. In the scheme housing association will be able to buy part or all of the struggling homeowners home. The owners will then be able to stay on as a tenant at a reduced rent.

Does this sound familiar to you? I think the government has decided to offer its own Sell and Rent Back scheme to struggling homeowners. Using tax payers money of course!

To what extent will the government be able to help? well lets look at the amount involved £200m. With the 200m they reckon they will be able to help 6,000 homes avoid repossessions across England. his may seem like a large number, but compared to the ammount of yearly repossessions, this figure is but a drop in the ocean. In 2007, 27,000 homes were repossessed by their lenders as the homeoweners could not afford to pay their mortgages. This figure rose to 45,000 in 2008. This year the number of repossession will be set to rise 75,000 (CML estimate) as the recession takes its toll. 6,000 homes saved will only therefore be 8% of homeowners that will be able to benefit from the new scheme. What about all the other 92% of homeowners who face repossession?

Will this be opportunity for the investor with private sale and rent back schemes? I think so, but any investor getting involved in rental properties will have to be cash rich as most buy to let mortgages now require at least 25% deposit.

9 thoughts on “Mortgage Rescue Scheme

  1. Sounds like a good program to me. All people should be protected against losing their homes. It’s never fun to be homeless.

  2. Yep! I agreed with Reese it a great opportunity for those peoples how are fearful on losing their homes.

    Also it was announced last week that they are extending the scheme and reducing the arrears period to three months.

  3. I do not believe that a £200million mortgage rescue scheme will be enough it might just be a start. This government has already thrown around £400 billion at the Banks in a serious attempt to rescue them. This new initiative should help to provide long-term stability to vulnerable homeowners who are losing their homes. This latest government initiative will also help the housing market from a flood of repossessed homes flooding on to an already depressed housing market with falling house prices. This initiative should protect homeowners from having to sell their homes to unscrupulous buy and rent back companies. Good Luck to Everyone!

    Michael McLaughlin, Cary real estate

  4. Yes, it is going on in the US, however, it does appear to benefit homeowners,too, and not simply the banks. In such a poor economic climate, property owners who have overleveraged themselves need some measure to pull them out from under an insurmountable debt.

  5. Well, I guess it is not surprising,that when the government do something to save the poor, lift the economy or save it, they are tend to use the taxpayers money. It is happening here in the US too. As long as the money will go too saved people losing their houses or keep people to their rented houses. Cheers, Michael McLaughlin, Cary real estate

  6. The Mortgage Rescue Scheme may be able to help you if you are an owner occupier in mortgage difficulties and you are in danger of having your home repossessed.

    Cheers,Samuel,Panama real estate.

  7. After all, at the height of the financial crisis, Prime Minister Gordon Brown launched a number of schemes to help struggling homeowners, which in turn would direct funds towards the banking system and boost liquidity. That’s not much use for families who have been struggling since last summer with sky-rocketing mortgage repayments.

    Panama real estate.

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