The Government has launched a national scheme to help home owners falling into debt with their mortgage payments.By providing good advice and assistance, the scheme aims to help mortgage borrowers stay in their home if they encounter problems paying their mortgage.
It may be sensible to use this timely information in conjunction with other debt management advice services and web sites.
Based around a user friendly web site, the mortgage help scheme offers a step by step guide to how to handle the situation so that struggling borrower can keep his home.
Covering topics such as missed mortgage payments, the threat of repossession and court orders, the web site advises people to face up to their difficulties and contact their mortgage lender as soon as possible.
There are links to local authority resources that may be able to help those close to repossession or a court appearance and detailed information about the processes that may result in the loss of a home.
This information campaign has won the support of the Council for Mortgage lenders. Michael Coogan, the CML’s director general commented
“We welcome this additional initiative by the government to remind borrowers to speak to their lender at the earliest possible opportunity, and preferably as soon as they think they might miss a payment. Avoiding possession is as important to lenders as it is to borrowers, and an early warning will help reduce the risk of this worst-case outcome.
Source
Saturday, November 28, 2009
Sunday, November 15, 2009
Home repossessions will continue
THE threat of hard-pressed families losing their homes will continue for two more years, housing minister John Healey warned last night as he unveiled the first wave of council house building for two decades.
Millions of pounds in public money is to be ploughed into the new homes.
But there will be just a handful in the Westcountry despite there being 60,000 people on waiting lists, which are likely to swell further as more people lose the battle against repossession.
The latest figures show there were 715 mortgage repossession claims issued in Devon, Cornwall and Somerset in the three months to June this year.
It shows a drop of about 30 per cent on the same time last year, which the Government claimed was down to increased help for those at risk of losing their home.
But the flagship Mortgage Rescue Scheme – which sees private homes sold to a housing association and rented back – has been widely criticised for failing to help a single household in the Westcountry.
Last month, the WMN revealed one family in Camborne, Cornwall, were left worse off after applying, being accepted and later rejected after running up thousands of pounds in mortgage arrears.
Mr Healey claimed efforts to help those struggling with mortgage payments in the recession were working.
But in a bleak warning about the economic prospects of millions of homeowners, he added: "Repossessions are still higher than before the recession and the pressures will continue. The risk of people losing their homes will continue at least for a couple of years, but recently repossessions have gone down as a result of the action we've taken."Today, he will announce a new programme of council house building, the first of its kind for 20 years. The Department for Communities claims the 2,000 homes nationwide will create 5,000 jobs in the construction industry.
"This is using the power of Government to act to build the homes that people need to keep the construction jobs that the economy wants and to help the economy through the recession," said Mr Healey.
However, in the Westcountry, there are pledges of just 38 new homes in East Devon and Exeter for 115 people, at a cost of £2.6 million.
No other local authority in Devon, or any in Cornwall and Somerset, applied for the money available in the first round of new council house building.
And in another blow to the Government's announcement, the Audit Commission will today claim councils focus too much on building new homes and should pay more attention to improving existing housing in their area.
The public spending watchdog said one in three councils struggled to understand the housing market they had on their own doorsteps. Councils felt pressured into focusing on building brand new housing, with 94 per cent prioritising new and affordable housing targets in their local area agreements.
But less than one in three councils had prioritised targets relating to their existing housing stock, such as bringing empty properties back into use, despite the financial savings, environmental improvements and social benefits of doing so.
Source
Millions of pounds in public money is to be ploughed into the new homes.
But there will be just a handful in the Westcountry despite there being 60,000 people on waiting lists, which are likely to swell further as more people lose the battle against repossession.
The latest figures show there were 715 mortgage repossession claims issued in Devon, Cornwall and Somerset in the three months to June this year.
It shows a drop of about 30 per cent on the same time last year, which the Government claimed was down to increased help for those at risk of losing their home.
But the flagship Mortgage Rescue Scheme – which sees private homes sold to a housing association and rented back – has been widely criticised for failing to help a single household in the Westcountry.
Last month, the WMN revealed one family in Camborne, Cornwall, were left worse off after applying, being accepted and later rejected after running up thousands of pounds in mortgage arrears.
Mr Healey claimed efforts to help those struggling with mortgage payments in the recession were working.
But in a bleak warning about the economic prospects of millions of homeowners, he added: "Repossessions are still higher than before the recession and the pressures will continue. The risk of people losing their homes will continue at least for a couple of years, but recently repossessions have gone down as a result of the action we've taken."Today, he will announce a new programme of council house building, the first of its kind for 20 years. The Department for Communities claims the 2,000 homes nationwide will create 5,000 jobs in the construction industry.
"This is using the power of Government to act to build the homes that people need to keep the construction jobs that the economy wants and to help the economy through the recession," said Mr Healey.
However, in the Westcountry, there are pledges of just 38 new homes in East Devon and Exeter for 115 people, at a cost of £2.6 million.
No other local authority in Devon, or any in Cornwall and Somerset, applied for the money available in the first round of new council house building.
And in another blow to the Government's announcement, the Audit Commission will today claim councils focus too much on building new homes and should pay more attention to improving existing housing in their area.
The public spending watchdog said one in three councils struggled to understand the housing market they had on their own doorsteps. Councils felt pressured into focusing on building brand new housing, with 94 per cent prioritising new and affordable housing targets in their local area agreements.
But less than one in three councils had prioritised targets relating to their existing housing stock, such as bringing empty properties back into use, despite the financial savings, environmental improvements and social benefits of doing so.
Source
Wednesday, October 28, 2009
Does the homeowners mortgage support scheme really help?
As the recession continues to bite into the UK property sector, more and more people are struggling to cover their monthly mortgage payments and looking for assistance. While the homeowners mortgage support scheme has been in place for some time there is some controversy regarding the basis on which the scheme operates.
In simple terms, households who see a significant drop in their income which could take away their ability to cover their monthly mortgage payments will have the option to switch to an interest only mortgage and defer up to 70% of interest payments from a maximum of two years. While this may well give some short-term relief to those struggling to survive in the UK, there is significant concern that all this is doing is stacking up larger debts for the future.
If those who take part in the homeowners mortgage support scheme see no improvement in their financial status within the two-year period then ultimately they will be in the same position with a higher debt load. The fact that many of the U.K.'s major mortgage providers refused to join the scheme says everything, with some citing the fact that they already have better schemes in place which are available to struggling homeowners.
Source
In simple terms, households who see a significant drop in their income which could take away their ability to cover their monthly mortgage payments will have the option to switch to an interest only mortgage and defer up to 70% of interest payments from a maximum of two years. While this may well give some short-term relief to those struggling to survive in the UK, there is significant concern that all this is doing is stacking up larger debts for the future.
If those who take part in the homeowners mortgage support scheme see no improvement in their financial status within the two-year period then ultimately they will be in the same position with a higher debt load. The fact that many of the U.K.'s major mortgage providers refused to join the scheme says everything, with some citing the fact that they already have better schemes in place which are available to struggling homeowners.
Source
Thursday, October 15, 2009
Government help for struggling homeowners
A new campaign has been launched to highlight the government support that is available to homeowners. This includes the Homeowners Mortgage Support Scheme which enables those who hit hard financial times to defer interest payments for up to two years while they get their family finances back on track.
Michael Foster said:
“Over 300,000 people across the UK have so far have received help and advice in paying their mortgage since April 2008 which is fantastic news.
“I have often met with constituents who face losing their home and I know it is one of the most frightening experiences for people. Thankfully there is a lot of help out there and I want the people of Hastings and Rye to be aware of that. The worst thing people can do is bury their heads in the sand.
“If you want help regaining control of your finances the best place to start is the National Debtline on 0808 808 4000. They offer impartial advice, real life examples of people who have already benefited from support, and can help you develop a personal action plan tailored to your particular circumstances.
“This action stands in contrast to the lack of action taken by the Conservative Government during the last recession, who did nothing to help families facing the threat of repossession.
"Today the Conservatives have changed their words but not their actions. They are happy to advise people to take up the help that Labour has introduced - but voted against the funding to pay for key measures like our increased support for mortgage interest."
Source
Michael Foster said:
“Over 300,000 people across the UK have so far have received help and advice in paying their mortgage since April 2008 which is fantastic news.
“I have often met with constituents who face losing their home and I know it is one of the most frightening experiences for people. Thankfully there is a lot of help out there and I want the people of Hastings and Rye to be aware of that. The worst thing people can do is bury their heads in the sand.
“If you want help regaining control of your finances the best place to start is the National Debtline on 0808 808 4000. They offer impartial advice, real life examples of people who have already benefited from support, and can help you develop a personal action plan tailored to your particular circumstances.
“This action stands in contrast to the lack of action taken by the Conservative Government during the last recession, who did nothing to help families facing the threat of repossession.
"Today the Conservatives have changed their words but not their actions. They are happy to advise people to take up the help that Labour has introduced - but voted against the funding to pay for key measures like our increased support for mortgage interest."
Source
Monday, September 28, 2009
New campaign offers practical support for struggling homeowners
Housing Minister John Healey today launched a new national campaign to help struggling homeowners take control of their finances and make the most of the support available for them to avoid repossessions and stay in their homes.
A series of press, online and billboard advertisements will highlight the measures the Government has put in place at every stage for homeowners to avoid repossession. Over 300,000 people have received help and advice in paying their mortgage since April 2008.
The advertisements will point people to an advice line and a new website illustrating the practical steps they can take to resolve their mortgage repayment worries, as well as contacts for the wide range of support available.
While this will be a national campaign, extra advertisements will appear in 22 "hotspots" - areas facing a greater risk of increased repossessions due to higher levels of unemployment and numbers of court orders.
A series of press, online and billboard advertisements will highlight the measures the Government has put in place at every stage for homeowners to avoid repossession. Over 300,000 people have received help and advice in paying their mortgage since April 2008.
The advertisements will point people to an advice line and a new website illustrating the practical steps they can take to resolve their mortgage repayment worries, as well as contacts for the wide range of support available.
While this will be a national campaign, extra advertisements will appear in 22 "hotspots" - areas facing a greater risk of increased repossessions due to higher levels of unemployment and numbers of court orders.
Monday, August 24, 2009
Mortgage rescue scheme helps just six families
Only six families in England have been aided by the government's mortgage rescue scheme, a junior communities minister has admitted.
Ian Austin confirmed the accuracy of the figure during a debate in Westminster Hall on the package, which was launched in January.
The initiative aims to help families who are struggling to pay their mortgages and are facing the threat of repossession.
Not-for-profit housing associations buy the properties and then allow the family to continue living there, charging an "affordable rent".
The statistic came in for criticism from the Conservatives and the Liberal Democrats, but the housing minister, John Healey, said that steps were being taken to speed up the process for vulnerable families.
"To make sure families are getting the support they need, I can confirm that from next month a new central team will operate to manage and fast-track the cases of those most at risk of repossession," he said.
Source
Ian Austin confirmed the accuracy of the figure during a debate in Westminster Hall on the package, which was launched in January.
The initiative aims to help families who are struggling to pay their mortgages and are facing the threat of repossession.
Not-for-profit housing associations buy the properties and then allow the family to continue living there, charging an "affordable rent".
The statistic came in for criticism from the Conservatives and the Liberal Democrats, but the housing minister, John Healey, said that steps were being taken to speed up the process for vulnerable families.
"To make sure families are getting the support they need, I can confirm that from next month a new central team will operate to manage and fast-track the cases of those most at risk of repossession," he said.
Source
Monday, July 20, 2009
CML: Mixed reaction to mortgage rescue
There has been a mixed reaction to the latest statistics monitoring take-up of the government’s mortgage rescue scheme.
Some reports have focused on the low number of households that have taken up an offer under the scheme. So far, only six households have done so, although more than 5,300 have embarked on the first stage of approaching a local authority to inquire about mortgage rescue.
Shelter criticised the low number of households taking up an offer under the scheme when the government published its latest statistics at the end of June. The homelessness charity called for a review of how successfully mortgage rescue was working. It said the scheme “has the potential to help many vulnerable home-owners to stay in their home, so it is very disappointing so few people have been accepted on to the scheme.”
Shelter continued: “Getting accepted into the mortgage rescue scheme is obviously taking considerably longer than we would want. The government needs to review the current eligibility process and tackle any issues that are preventing people from successfully taking up the scheme.”
Small scale
It should not be forgotten, however, that the scheme was only ever intended to operate on a fairly small scale, providing help for 6,000 households over two years. The circumstances of each individual case have to be carefully assessed – and there are a number of stages of the process to work through – so it was always likely that progress from inquiring about the scheme to acceptance into it would take some time.
Mortgage rescue is, of course, also only one of the possible solutions available to households experiencing payment difficulty.
It is important that borrowers explore all the options, including the range of tools that lenders already have at their disposal like switching from a capital repayment to an interest-only mortgage, re-structuring their payments or extending the length of the term. And other government schemes – including help through income support for mortgage interest and the home-owner mortgage support scheme – might be more suitable for households in different circumstances.
Meanwhile, with cases of possession now rising more slowly than the number of borrowers falling into arrears, there is evidence that lenders are showing forbearance where they can and helping borrowers to work towards solving their problems, even if they do not end up in a government scheme.
Working with borrowers
Although only a handful of home-owners have accepted an offer of mortgage rescue, the much larger number of inquiries about the scheme may indicate that an increasing number of home-owners in difficulty are taking action to address their problems at an earlier stage, including discussing them with their lender.
Sometimes, borrowers have not even been in touch with their lender, despite experiencing difficulty. This was borne out at our mortgage regulation conference yesterday, when the chairman of the Financial Services Consumer Panel, Adam Phillips, told delegates that more than 40% of those having difficulty paying their mortgage did not seek advice in dealing with their problems. And that happened even though seven out of eight of those in difficulty thought their problems were serious.
Source
Some reports have focused on the low number of households that have taken up an offer under the scheme. So far, only six households have done so, although more than 5,300 have embarked on the first stage of approaching a local authority to inquire about mortgage rescue.
Shelter criticised the low number of households taking up an offer under the scheme when the government published its latest statistics at the end of June. The homelessness charity called for a review of how successfully mortgage rescue was working. It said the scheme “has the potential to help many vulnerable home-owners to stay in their home, so it is very disappointing so few people have been accepted on to the scheme.”
Shelter continued: “Getting accepted into the mortgage rescue scheme is obviously taking considerably longer than we would want. The government needs to review the current eligibility process and tackle any issues that are preventing people from successfully taking up the scheme.”
Small scale
It should not be forgotten, however, that the scheme was only ever intended to operate on a fairly small scale, providing help for 6,000 households over two years. The circumstances of each individual case have to be carefully assessed – and there are a number of stages of the process to work through – so it was always likely that progress from inquiring about the scheme to acceptance into it would take some time.
Mortgage rescue is, of course, also only one of the possible solutions available to households experiencing payment difficulty.
It is important that borrowers explore all the options, including the range of tools that lenders already have at their disposal like switching from a capital repayment to an interest-only mortgage, re-structuring their payments or extending the length of the term. And other government schemes – including help through income support for mortgage interest and the home-owner mortgage support scheme – might be more suitable for households in different circumstances.
Meanwhile, with cases of possession now rising more slowly than the number of borrowers falling into arrears, there is evidence that lenders are showing forbearance where they can and helping borrowers to work towards solving their problems, even if they do not end up in a government scheme.
Working with borrowers
Although only a handful of home-owners have accepted an offer of mortgage rescue, the much larger number of inquiries about the scheme may indicate that an increasing number of home-owners in difficulty are taking action to address their problems at an earlier stage, including discussing them with their lender.
Sometimes, borrowers have not even been in touch with their lender, despite experiencing difficulty. This was borne out at our mortgage regulation conference yesterday, when the chairman of the Financial Services Consumer Panel, Adam Phillips, told delegates that more than 40% of those having difficulty paying their mortgage did not seek advice in dealing with their problems. And that happened even though seven out of eight of those in difficulty thought their problems were serious.
Source
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