The Mortgage Rescue Scheme has been running in the UK since January 2009. Its purpose is to provide vulnerable families who are at risk of losing their home with financial assistance and alternatives to a repossession from their lender. There are two main avenues homeowners can go for when applying for the Mortgage Rescue Scheme: The Government Mortgage to Rent option and the Shared Equity option. Although these schemes have received a lot of publicity and interest from the public, has the program been successful? Has it accomplished what it set out to do? The statistics for the first quarter of 2011 have just been released. They tell a story that although far from a one-size-fits-all solution to the issue of repossession, does seem to be providing some respite to struggling homeowners throughout England.

It is worth noting that the two options available in the Mortgage Rescue Scheme are from the only options available to lenders. Lenders have several methods at their disposal to reduce monthly payments and help low-income families save their homes. These methods include short term reduction of mortgage payments, prioritize debts and increase the term of a loan. However, when these options fail or the lender will not consider an alternative, it may be time to consider a Mortgage Scheme.

Pleads for Help

One way of assessing the success of the Mortgage Rescue Scheme is to analyze the number of households which have asked for help. In the first quarter of 2011, 5,039 families asked for help through the Mortgage Assistance Program. Of these 5,039 families, of which 2,133 were in actual risk of falling into a repossession. Of the total amount,  1777 received personalized advice, 1,829 were referred to their lenders, 1,184 were actually offered an housing option through the scheme. These statistics were collected through the various jurisdictions of England, which include the North East, the North West, Yorkshire and the Humber, the South East, the South West, London, the East as well as the East and Wet Midlands. The North West is the area with the best success record in offering clients an alternative to repossession.

Mortgage Solutions

Of the 5,039 families, 692 families applies for a housing scheme, currently there are 1,594 live applications as of May 2011. Of these, only 606 have actually received a confirmation and have accepted the offer for a mortgage rescue scheme. Since April 2009, when the program started, 2621 families have benefited from the program, which although still a small number considering that in February 2011 around 251,000 homeowners were behind or delinquent in their mortgage payments, does provide a little solace to families who cannot afford to find a new home and qualify for the program’s requirements.

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