Mortgage Rescue Scheme
Mortgage Rescue Scheme booklet [pdf document, 378kb]
The government introduced a £200m package which aims to prevent homes being repossessed during the current recession.
If you are having trouble meeting your mortgage payments you will firstly be referred to a Money Advice agency (C.A.B) who will work with your mortgage lender to try and resolve the problem. Mortgage lenders have agreed to be more flexible than ever before and have a range of solutions available. These include ‘mortgage holidays’, changing to an interest only mortgage, and restructuring of payments.
If they are not able to come to any agreement with your lender, you will be referred back to the Housing Options Team to see if you are eligible for the Mortgage Rescue Scheme.
Eligiblity Criteria
You must be in a ‘Priority need’ group – for example – have dependent children or be vulnerable because of medical problems, being elderly or other reason.
You must have a total household income of less than £60,000 per year.
Your property must be worth less than £125,000 (although this may be reviewed.)
Your outstanding mortgage must be no more than 120% of the current market value of your house.
The products
If you fit these criteria, we will refer you to a Registered Social Landlord who will carry out a final assessment, a valuation of your house and then decide which of the two products available will be appropriate for you.
Shared Equity product
For households who have a mortgage of no more than 75% of the current value or their home.
The provider will offer an equity loan to the household, secured as a second charge, to reduce mortgage payments to an affordable level.
Government Mortgage to Rent
Aims to help household who have a mortgage of no more than 97% and no less than 75% and who are currently or expected to become benefit dependent.
The provider will purchase the freehold (or leasehold) of the property and then issue a lease to the tenant at a rent equivalent to 80% of the open market rent.
More information about Mortgage help on the DirectGov website