The FirstBuy scheme is the UK government’s latest effort to help low- to medium-income families who wish to buy their first home, but are unable (or find it difficult) to do so because they do not have the savings to pay the 25 per cent down payment most lenders require. For instance, a typical lender will gladly lend you (if you have a reasonably good credit rating) 75 per cent of your home’s value. However, most lenders require you to come up with 25 per cent by yourself, 5 per cent as a deposit, and 20 per cent as a down payment. Some lenders will not even let you pay for this with another loan for fear two loans will prove too much of a financial burden for your monthly budget. The FirstBuy scheme sidesteps these problems by providing a home equity loan of 20 percent of your home’s value (5 per cent you still have to find yourself). The beauty of this program is that it is paid as a partnership between the government and housebuilders and it does not have to be paid until you sell your home.

The fact the financial burden is shared by both the government and homebuilders is good news for taxpayers, and many builders are happy to pay their share if it allows them to unload empty new homes which have already been built. The second benefit of the loan—that it does not have to be repaid until you sell your home—solves the problem of increasing the financial burden on families who can’t afford a mortgage and a second home equity loan to pay for the down payment and deposit element of the home purchase.

If you live in the United Kingdom and would like to get your foot on the first rung of the property ladder, there is good news for you. The good news comes from a new scheme set up by the government and house builders for British homebuyers. One of the biggest problems British families who wish to buy a home face is the lack of savings to pay for a down payment. They might have the monthly income to pay for a mortgage but not enough savings to pay for 10 to 20 percent of the house’s price as down payment. This is not only in a nuisance for families wishing to own their own house, it also slows down the recovery of the real estate sector, which needs all the eligible buyers it can get its hands on.

Despite rumors that the program would be “killed” due to budget restrictions, the Mortgage Rescue Scheme is still alive and kicking thanks to 200 million pounds earmarked for its funding during the next two years. This popular although underused program is designed to help low-income and vulnerable families avoid repossession by either buying their homes and renting them back at a reduced price or by buying a percentage of the home and reducing the mortgage payments. However, March 2011 has seen some changes brought on the 2009 program specifications. If you are considering applying for a mortgage rescue program, these changes will affect you. However, if your application has already been processed by a registered provider, these changes will not apply to you.

Purchase Rate Changes

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.

If you are at risk of losing your home, the Mortgage Rescue Scheme is an initiative you should look into. Although this website does not provide homes or loans we have done the research to provide you with the advice you need to save your home from a repossession.

Our first piece of advice is act quickly. Once you are behind in your payments and a lender starts a repossession claim, time is of the essence.