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Thousands of families facing the threat of repossession can now apply for government help to stay in their homes, as a mortgage rescue scheme is rolled out across the whole of England.
The £200m scheme allows vulnerable households to reduce their monthly mortgage payments by selling a share in their home to a housing association, or to sell the property to the association outright and remain in it as tenants on subsidised rents.
The government hopes the scheme will save 6,000 homeowners from losing their property over the next two years.
First announced as part of a package of help in September, the scheme has already been taken up by 80 councils and is expanded to all local authority areas in England from today.
The housing minister, Margaret Beckett, said: "We know that some families are worried about their mortgage payments right now, and we are determined to do everything possible to ensure repossession is always a last resort.
"For the most vulnerable households, the mortgage rescue scheme will be available across England to help ensure they can remain in their homes."
The mortgage rescue scheme is targeted at households with incomes of less than £60,000 a year who would be entitled to be rehoused under homelessness legislation because they are elderly, disabled or have children.
It is intended as an alternative to controversial sale-and-rent-back schemes which allow homeowners to stay in their properties, but are currently unregulated.
Rise in arrears
The mortgage rescue scheme comes as repossessions are increasing, with the Council of Mortgage Lenders (CML) predicting that 75,000 homeowners will lose their homes this year. About 200,000 people are at least three months behind on their mortgage repayments.
In response, the government last weekcut the waiting period before homeowners who lose their jobs qualify for state help with mortgage interest payments from 39 weeks to 13.
And ministers are working with lenders on a homeowner mortgage support scheme, which will allow households who suffer a sudden drop in income to defer part of their payments for up to two years.
The Conservative housing spokesman, Grant Shapps, said: "We welcome anything that will genuinely keep people in their homes, but ministers are guilty of running around like headless chickens announcing complicated, confusing and often contradictory plans, which later turn out to help far fewer people than the headlines would have you believe."
National Housing Federation, chief executive, David Orr, said: "The mortgage rescue scheme will save thousands of vulnerable families from the nightmare of having their homes repossessed and give them the long-term stability they need.
"It will also serve to undermine those shadowy companies currently making money out of people's misfortune by buying their properties at substantially less than the going rate - and then only letting them stay on a short-term tenancy basis."
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