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.


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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."


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