Mortgage Rescue

In January 2009 the Government launched a Mortgage Rescue Scheme with the aim of supporting vulnerable households facing repossession to remain in their own home.

The Government have made £200 million worth of funding available to help up to 6,000 households over the next 2 years.

How will the scheme help?

Households will be helped by one of two options. The most appropriate solution for your household will be based upon your circumstances. The two options are:

Shared Equity – where you sell a share of your house to a Housing Association
Mortgage to Rent – your property is sold to a Housing Association so you can remain in it as a tenant and pay a rent below the market rate.

Am I eligible for the scheme?

You must be the homeowner.
Your lender must have exhausted all of the hardship options with you. There are 7 options but not all of them will be applicable to your circumstances.
Your property must be valued at no more than £125,000.
The total income of your household must be below £60,000 per annum
Your household must contain one of more of the following:

Dependent Child
Pregnant woman
A person who is vulnerable due to old age, mental illness, or handicap or physical disability.

You must want to be considered for the scheme and want to stay in your property.
The scheme must be affordable to your household
Any debt on the property must be less than the current value of the property.

What if I am not eligible for the scheme?

The scheme is not able to help all households who are facing repossession but there may be other alternatives that are suitable for your situation. We can discuss other alternatives with you.

How do I apply for the scheme?

You must first make contact with your lender to see if they can assist with hardship options. The hardship options are:

Providing you with a payment holiday.
Reducing your monthly payments for a certain period.
Offering a better rate.
Adding any arrears onto the amount borrowed.
Extending or changing the term of your loan.
Converting your loan to interest only.
Allowing you time to sell your home if you want.

You will also need to make contact with an appropriate advice agency if you have not already done who can provide you with a full financial statement, negotiate with creditors and will also advise on whether the Mortgage Rescue Scheme is right for you. We can put you in touch with a local advice service.

If all of the hardship options have been exhausted, your lender is in agreement and the financial statement shows that the scheme is a suitable option then a full Mortgage Rescue Application is taken by Cheshire East Council.

Your case is then referred to one of the Housing Associations operating the scheme in Cheshire East. The Housing Association will carry out further work including more financial work and a valuation of the property. This will help them to decide if they can help and if so, which of the two rescue options is best

What if I’m not successful with the scheme?

If, at any one of the stages mentioned above, you are not successful for the scheme, then you will be referred back to your housing options officers for advice and assistance in other alternatives.

How long will the process take?

To get through all of the stages, and for the process to be completed it will take at least 3 months.