New Government support for homeowners

David Lepper MP and Housing minister Margaret Beckett are highlighting the help available to keep people in their own homes if they fall on difficult times.

The Homeowners Mortgage Support (HMS) will enable eligible borrowers who suffer a temporary loss of income to cut their mortgage interest payments for up to two years to help them get back on track with their finances.

Brighton Pavilion MP David Lepper said:

"This excellent scheme will ensure repossession is always a last resort. I want everyone in the city to be aware of what help is available.

"The Labour Government is committed to helping people through these difficult times. Losing your home is one of the most devastating things that can happen but Labour is determined that hard working people, who are facing difficulties such as temporary unemployment, are not left to fend for themselves.

"This stands in contrast to the Tory plan to slash £810 million from the communities' budget - a cut which could have a devastating impact on those people."
Margaret Beckett welcomed David's support, adding:

"We know that many families are worried about how to pay the mortgage right now, and we're determined to ensure there is help available for them.

"Today's news is a result of excellent co-operation between Government, lenders, and money advice services.

"On top of the range of measures we've already put in place, this new support will help borrowers who just need a bit more time to get themselves back on their feet. This is in stark contrast to the early 1990s when there was nothing.

"The clear message to borrowers is to contact your lender straight away if you're concerned about how to pay the mortgage as often a solution can be found."

1. Borrowers who are interested in applying for Homeowners Mortgage Support or the equivalent offer, should contact their lender in their first instance to check their eligibility.
2. For lenders offering HMS with the Government guarantee, the borrower must
   
   • Have bought their home before 1 December 2008;
   • Be an owner-occupier - the scheme is not open to buy-to-let or investment properties
   • Have an outstanding mortgage of less than £400 000 and having savings of less than £16 000.
   • Have a regular household income and should be able to make a minimum contribution of 30% of the total interest payment
   • Have talked through other options with their lender and have been making regular payments for at least five months.
   • Have sought independent money advice.
3. More information for consumers on Homeowners Mortgage Support can be found at www.direct.gov.uk/HMS.
4. The Government has put in place a comprehensive package of support to ensure that repossession is always a last resort. This includes:
   
   • Free legal and debt advice with £25 million invested to expand these services, including an additional £2.5 million to support HMS
   • A new Pre- Action Protocol that requires lenders to prove that they have exhausted all options before seeking repossession through the courts.
   • Agreeing with lenders a three month minimum waiting period before lenders seek to repossess.
   • More help for people who lose their jobs by reducing the waiting time for Support for Mortgage interest from 39 weeks to 13 weeks.
   • A £200m Mortgage Rescue Scheme to help the most vulnerable households avoid repossession.
5. Money advisers that have been trained to deliver Homeowners Mortgage Support advice include Citizens Advice, Shelter, CCCS, National DebtLine and Payplan.