Scottish Government
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Help for struggling home owners

Two new schemes to help home owners struggling to keep up with mortgage payments start today.

A new Mortgage to Shared Equity scheme involves the Scottish Government taking a financial stake in the home of an owner who is in danger of being made homeless.

A new, improved Mortgage to Rent scheme helps people facing repossession to stay in their home as tenants of a social landlord.

The £35 million Home Owners' Support Fund will fund both schemes over the next two years.

Housing Minister Alex Neil urged home owners in financial difficulty to seek independent advice as soon as possible.

Mr Neil said:

"As part of the Scottish Government's economic recovery plan, we have acted decisively to help home owners deal with the impact of the economic recession.

"Today sees the introduction of a new, improved Mortgage to Rent scheme and a new Mortgage to Shared Equity scheme, providing an option for families across Scotland struggling with mortgage repayments.

"It's important that those facing the risk of repossession seek urgent independent money advice. It may be possible, for example, to try and reach agreement with any secured lender before considering other forms of support.

"Only then can they make an informed decision about whether the Home Owners' Support Fund is an option that suits their needs."

"We have also set up a Repossessions Group to report by April 30 on whether legislative protection for those at risk of losing their home requires further strengthening."

In her statement to Parliament on June 25, 2008, the Health Secretary Nicola Sturgeon announced a package of major reforms to deliver lasting improvements to Scotland's housing system. This included the establishment of the new Home Owners' Support Fund.

The Mortgage to Rent scheme has been in place since 2003 and aims to help owner occupiers who are in financial difficulty and in danger of being made homeless. The scheme helps by enabling households who are eligible to remain in their home by selling it to a social landlord - normally a local authority or housing association and becoming a tenant of that landlord.

The property is sold to a landlord and then rented back to the household. The scheme provides Government subsidies to the landlord to enable a social rent to be charged and for the property to be brought up to a decent standard of repair.

Those eligible for Mortgage to Shared Equity must have at least 25 per cent equity in their home and will retain ownership. They will enter into a shared equity agreement with the Scottish Government, having had their secured debt reduced to a manageable level.

Related Information

  • More information about the Home Owners' Support Fund
  • Help through the downturn
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