MSE News: Mortgage rescue scheme comes up short

Former_MSE_Guy

This is the discussion thread for the following MSE News Story:

"A government scheme to help people avoid losing their homes has assisted fewer than half as many households as expected at three times the cost ..."

Read the full story:
Mortgage rescue scheme comes up short

Heyman_2

A government scheme underdelivering and going well over budget?

I don't believe it!

michaels

How has it 'cost' this much if they have purchased assets - are all the properties purchased now worthless?

Reaper

The scheme will cover even a 20% negative equity. If my house had negative equity of course I would jump at the chance to sell it for 20% more than it was worth. Not surprising so many took up the option.

luluspice

We applied for the scheme, were unable to find a social landlord prepared to buy our home - they do not have the money- we didn't qualify for the shared equity - you have to have been making payments to your mortgage for at least 5 months before to qualify. so you are suppose to be able to afford your mortgage then suddenly get on the sheme??? Our mortgage company had not heard of the sceme - causing delays & resulting in them getting a repossession order - when you advise them you are applying to the scheme they are suppose to back off & give you time to go through the process. As it is a year down the line, no social landlord in position to help, arrears built up, DSS only paying £97 per month on £800 per month mortgage...guess we gonna be homeless this year!

Angiepange

Reaper wrote: »

The scheme will cover even a 20% negative equity. If my house had negative equity of course I would jump at the chance to sell it for 20% more than it was worth. Not surprising so many took up the option.

The scheme does cover properties up to 20% negative equity, however the RSL will only offer the market value of the property after instructing an independent valuer to price it. They will then pay 90% value of the home (previously was 97%) so as a homeowner, if you are in NE you are left with a shortfall of potentially several thousands of pounds and of course your lender would have to agree to the sale too.

Some lenders will agree to write this off, others won't, resulting in agreeing a repayment plan for the shortfall.

You don't sell your home for 20% more than its worth.

fatbelly

Angiepange's thread is the classic one on this scheme:

https://forums.moneysavingexpert.com/discussion/1930931

and she is well placed to make comment.

The concept of such a scheme was sound, but it was thrown together in haste, and became very bureaucratic. As someone who followed Angie's thread in the early days, I'm amazed that she coped with the stress of the scheme, though the ultimate outcome was brilliant.

I'm using the past tense as I've been informed that there is no money available now for the 'southwest' region.

WER4

Hi to you all! I so understand about this MRS! It is frustrating, depressing and annoying. We have been tring to get MRS to help for 2 years now, the council has completely dragged their feet, using every excuse in the book, this alongside HSBC's complete lack of help (the 1st 6 months no one knew what the scheme was and we were being told it does not exist), harrasment, dragging their peg legs, poor attitude to be told this week that government has slashed ove 50% funds and there is no room for us. We have been treated like criminals and the joke is - I have an deteriaoting illness causing disability where I can not work (like the good old days) Now we have been told that the Council is not going to help with housing as my condition does not fit any of their remit! So whatch out world - don't get an illness that screws your body up and your life because despite being a nurse for 20yrs + and never claiming on benefits (except recently) The council and bank don't care - advertise they do and help is available - but when it comes to the crucn - they will state that being ill and diabled does not warrant help - despite paying council tax and life insurance etc!

I wish you all the very best of lucj and I know it is hard when you are loosing your home etc and identity but try and find something to smile about and that silver lining - my god - don't we meed it!

notfunnymoney

As Angie will know (thanks to her very kind help to me!) I have also been through and completed a MRS....it was quite possibly the worst thing I've ever had to go through and because there was very little known about it by ANYONE it was up to me to do my own research to find out what was required, the order of the various stages of the process etc - it actually got quite laughable when I WAS ADVISING the Council and CAB on what to do next etc! There was v little info on the internet about it, only what Angie could advise from experience and a Process Flowchart which I ref in the above post link of Angie's.... I think the lack of knowledge about the processes of the scheme and all the redtape etc is what incurred a lot of extra charges.... Overall, I can't help thinking that without this scheme, me and my family would had to have been rehoused eventually and there is already a massive shortfall of social/affordable housing, that by buying our property they now have added to their stock and assets so its probably not as bad as what they're saying?! I don't know, I'm just glad that, horrendous as it was, we did it and completed it before it was too late!

adge666

I'm sorry to hijack this thread - well, maybe not quite hijack but since you are talking about the MRS, I just wondered if anyone knows whether the criteria for income is gross or net (actual take home pay). I think the CAB website states that annual household income should not exceed £60k. I assumed that meant actual take home pay, whereas the Shelter website says gross income should not exceed £60k. Since there is such confusion about this scheme, I could do with getting clarification before going ahead with what appears a hideously drawn-out process. My wife is seriously ill and I don't want to raise her hopes or stress her needlessly. Thanks:o

fatbelly

checklist from the CAB:

Households in priority need, such as those with children or dependents, including households with pregnant woman, or
Households where someone is over 60 years old or has an illness or disability, or is otherwise vulnerable
Household with max gross income of £60k per annum, and
Households with no assets they could realise to reduce housing debt, and
Households within the regional property cap (see below) and
House with no more than 120% of its value secured against it
A table of regional property price cap levels
Region Price Cap
North East £125,000
North West £135,000
Yorkshire & Humberside £140,000
East Midlands £155,000
West Midlands £155,000
East £200,000
South West £205,000
South East £235,000
London £305,000