Mortgage rescue scheme (MRS) has overspent and missed targets

It’s been reported that the mortgage rescue scheme that was set up to help home owners avoid being repossessed that it has overspent on its budget by £35m and only helped less than half its target audience. The scheme allowed home owners struggling to make mortgage payments to sell part or all of their home to a housing association and rent it back or enter into shared ownership agreement. It was hoped the plan would cost £205m and help 6,000 homeowners. But a report from the National Audit Office revealed the scheme cost £240m and helped just 2,600 households, which is a small figure compared with the circa 180,000+ struggling to pay their mortgages. More than 98% of households on the scheme chose to sell their homes, leaving 1.5% opting for the cheaper shared equity route and raising the cost of the project. The report accused the Communities and Local Government Department of misunderstanding what support borrowers wanted and reacting slowly when it became apparent the scheme was not providing value for money.

Luke Memory, Head of External Affairs at Revival Repossession Solutions comments “This is not surprising considering the way the scheme was launched and the lack of support that existed among lenders at the time. It was always just a political stunt the problem was never dealt with” We all wait now in anticipation of a tidal wave of Repossessions as the country faces a double whammy of the Labour Government under Gordon Brown avoiding the problem and imposing no fiscal control and now the Conservatives come along and make serious cuts in the budget for the little support that there was”

Find out more about how the Government have overspent on Mortgage Support at the following BBC Website Link – Click Here

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