Housing Minister Margaret Becket has revealed that just two families have so far been helped by the government's flagship home repossession 'safety net' initiative.
The £200m Mortgage Rescue Scheme is supposed to prevent the homes of families who earn under £60,000 from being repossessed, but despite over a thousand households applying for relief every month since its launch earlier this year, the green light has been given to just 87 households - and just two of those have completed the process.
The announcement prompted severe criticism in the House of Commons yesterday. Philip Davies, Conservative MP for Shipley, said: "Is this not another example of the Government seeking publicity-in a blaze of glory-to pretend they are helping people when in reality they are failing to deliver any tangible help to people suffering hardship through no fault of their own?"
And Sarah Teather, Liberal Democrat MP for Brent, East, added: "The Minister will be aware that 75,000 families are expected to face the misery of repossession that she spoke about. Even if we were to add in all the package of measures to which she referred, tens of thousands of families would still be left facing that misery."
The main reasons for the scheme's lack of success so far are three fold. The late and relatively reluctant entry of mortgage lenders into the scheme mea ns the scheme didn't really start until late April. Only half of all lenders have joined the scheme - against a predicted 70 per cent, and it has taken four months so far to get the first tranche of them signed up.
Also, the financial hoops that homeowners must jump before being accepted onto the scheme have delayed help being offered, plus the scheme does not prevent repossession but rather converts home owners into tenants and then allows them to continue living in a property - something many homeowners don't realise until they read the detail of the scheme.
http://blogs.propertyfinder.com/news/2009/02/government_rolls_out_mortgage.html
