Minister Announces New Proposals To Help Mortgage Defaulters

Citizens Advice welcomes the Social Development Minister Margaret Ritchie’s proposals to help people with mortgage and secured loan arrears.  The Minister outlined two initiatives today. One is a Mortgage to Rent scheme whereby a Housing Association would buy a property on behalf of a person who could not afford to keep up with their mortgage repayments.  The Housing Association would then lease the property back to that person at an affordable rent. The second initiative, known as ‘Reverse Staircasing’, is for people with much smaller outstanding mortgage debts who are experiencing difficulties making repayments.

The owner of the property would be able to sell a share of their property to a Housing Association and retain a certain share.  They would continue to pay mortgage payments on the share they own and an affordable rent on the share they sold.  This would be done with a view to the home owner buying the share they sold back when their circumstances improve.

Figures from the Northern Ireland Court Service show a 33% increase in the number of repossession cases being lodged at Court, which is of concern to Citizens Advice who have also seen a marked increase in the number of clients with debt problems.  For the first three months of 2008 the Dealing with Debt service helped over 200 new clients per month and the demand for assistance with secured loan arrears has been a major factor during the same period.