Homeowners facing repossession or struggling to meet mortgage payments after losing their jobs will receive extra support from the government following yesterday’s pre-Budget report.
The government focused its attention on helping existing borrowers in danger of losing their homes rather than first-time buyers who are having difficulty entering the property market.
From April, the government has agreed to cover the monthly interest due on mortgages of up to £200,000 for eligible borrowers who have been out of work for at least 13 weeks and are having difficulty meeting their payments.
Previously it only offered support to homeowners with mortgages of £100,000 or less.
The maximum rate of interest the government is willing to pay will remain at 6% despite the recent interest rate falls.
Borrowers who have missed mortgage payments should also be treated more fairly by lenders.