Govt Mortgage to Rent Scheme/Will it save my house?

edited 19 September 2010 at 3:02PM in Bankruptcy & Living With It
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AngiepangeAngiepange Forumite
3.5K Posts
edited 19 September 2010 at 3:02PM in Bankruptcy & Living With It
Hi

Inspired by another thread on here by Fooman and his house situation I got in touch with Shelter this morning for advice on the Govt Mortgage to Rent scheme.

We are interetsed in this scheme because having just gone BR we are struggling with mortgage payments (though not in arrears yet) and have been considering giving our house up for Vol Repo and renting privately.

Problems we face is to rent round here is just about same/bit more than what we are paying on our fixed mortgage. As BR's we anticipate renting will not be as easy as if we were not BR for obvious reasons!! Our fix rate mortgage ends next year and we will be at the mercy of SVR and any potential rises :eek:.

On this scheme our LHA would buy our home from us and rent it back to us at 80% market value, we would no longer own the home but would be tenants instead. They will accept homes in Neg Equity which we are, up to a certain % and I did inform her the OR has no interest in our house as he offered us the BI to buy back asap. If accepted for the scheme we would be offered an assured tenancy of 3 yrs. Now on the face of it this would seem the answer to our prayers. We could stay in our home for now, no upheaval of moving and would be free to move out further down the line if we want to (long term plan is a move back to the West Country when kids schooling finished).

The cost to us would be 3% of the value of home. The advisor on the phone seemed to think we might meet the criteria esp as we have recently gone BR and she knew our lender doesnt offer the Mortgage Support scheme so this could be a potential alternative. She advised a local appt to go thru it all F2F with an expert. Lo and behold I ring up and they offer me an appt for tomorrow morning :T Now im probably getting my hopes up BUT I am hoping beyond hope we might get somewhere with this???

Has anyone else on here got any experience of this scheme or know any info? Obviously I will find out alot more tomorrow. Wish me luck. Thanks as always.

Angie x
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Replies

  • Miss_PoohsMiss_Poohs Forumite
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    Ohh I'd be interested to know how you got on.

    I was speaking to my OHs debt advisor about this and he thought it was a worth while scheme, although he did say you had to be 3 months in arrears to be considered.

    Best of luck and let me know what you think.
    Don't try to keep up with the Joneses - Drag them down to your level - it's cheaper . :p:D
  • Thanks again for info Fooman,

    Yeah that is disappointing to say the least! Still, I will try and keep optimistic for my appointment tomorrow with Shelter.

    If that route is closed to me, maybe they can suggest something else?

    Angie x
  • lee316lee316 Forumite
    134 Posts
    Angiepange, I sincerely hope that it all works out for you, but I am with Fooman on this one.
    We have tried going down that route with our local council, on the advice of CAB. Council first claimed they knew nothing about it, until I pointed out that CAB informed me that they did. After about half an hour wait, they informed us that yes indeed they do participate in the scheme, why?
    As we originaly bought our house from them, we thought that would go in our favour with them. They said go home and somebody will call you, as they did - two weeks after. In the meantime they've sent us their booklet in which it clearly states that yes they do participate in a government buy back scheme, and explains what is it about, as you already explained in a nutshell Angie.
    The phonecall, however, went a bit different. The advisor laughed at my suggestion of it.No they are not doing it, they haven't got the money for such a scheme, and our circumstances have to be extreme for them to even consider it. What do they class as extreme, they couldn't answer, apart from to say that there is only one property in the whole country that has been brought back (probably the one Fooman refers to in his article).
    So why does it state in your booklet that you participate? Government publication was their answer.

    I've asked them do they realise that when my house gets repossesed we will be coming to them for help in rehousing us (not that we are holding our breath for that one), and they say well come back back when it hapens and they will do whatever they can, but warning me that they cannot house the people who they already got on the list.
    So al in all it looks like we are destined to rent.
  • debt_doctordebt_doctor Forumite
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    Hi,

    My client is very likely to win the race to be the second person in the country to be successful in the mortgage rescue scheme. It has all been approved and the rent level has been decided ( although I appealed the first rent determination as it was not 20% below market rent as required) This scheme is designed to help 6000 families across England and Wales over 2 years, so i'm afraid not a great amount to each local authority.

    It is not true that you have to be 3 months in arrears to join the scheme, but must be or about to have difficulty in paying the secured borrowing. The family must also have 'priority need' as per the homeless legislation ie children under 16 or 19 in FTE, or otherwise vulnerable.

    DD
    Debt Doctor, Debt caseworker, Citizens' Advice Bureau .
    Impartial debt advice services: Citizens Advice Bureau Find your local CAB *** National Debtline - Tel: 0808 808 4000*** BSC No. 100 ***
  • Miss_PoohsMiss_Poohs Forumite
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    Valuable info there - and is the scheme the same across the UK or is it different in Scotland?
    Don't try to keep up with the Joneses - Drag them down to your level - it's cheaper . :p:D
  • debt_doctordebt_doctor Forumite
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    I beleive the scheme originally was for England only, Wales joined later. Scotland and N ireland are either setting up or have set up their own similar scheme. It would be best to ask your local council / CAB / advice centre.

    DD
    Debt Doctor, Debt caseworker, Citizens' Advice Bureau .
    Impartial debt advice services: Citizens Advice Bureau Find your local CAB *** National Debtline - Tel: 0808 808 4000*** BSC No. 100 ***
  • hi guys we are in scotland and went through said scheme AND IT WORKS ! only draw back is that is very slow took us from july 08 to feb 09 for every thing to complete .
    money doesnt come from council but is from scottish goverment and also if you have council tax arrears you must make agreement to pay them
    And lastly you need a very understanding bank because of the time it takes bank of scotland were on verge of repoing but cab put them off after explaining that they would be paid in full even then they kept adding charges on
  • edited 19 September 2010 at 3:03PM
    AngiepangeAngiepange Forumite
    3.5K Posts
    edited 19 September 2010 at 3:03PM
    Hi,

    My client is very likely to win the race to be the second person in the country to be successful in the mortgage rescue scheme. It has all been approved and the rent level has been decided ( although I appealed the first rent determination as it was not 20% below market rent as required) This scheme is designed to help 6000 families across England and Wales over 2 years, so i'm afraid not a great amount to each local authority.

    It is not true that you have to be 3 months in arrears to join the scheme, but must be or about to have difficulty in paying the secured borrowing. The family must also have 'priority need' as per the homeless legislation ie children under 16 or 19 in FTE, or otherwise vulnerable.

    DD

    Thankyou DD

    Shelter went thru all this on the phone with me and agreed that we could be 'about to' have difficulty looking at our level of income/expenditure (and the fact we have just gone BR) and could become benefit dependant if we get re-possessed. They also agreed we would have priority need as we have 2 children (13 and16).

    They also said you must have approached your lender to explore options which we have done and the best the mortgage co can offer is 3 months on a reduced mortgage and then the arrears arising from that paid back on top of the normal payment for the next 6 months. You also needed to have sought debt advice and thats something I can say ive had enough of to last a lifetime !!
    Angie x
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