Shelter Cymru is calling on Welsh Government to create a new scheme to rescue the homes of people struggling to afford their mortgage payments because of the cost of living crisis.
The people and homes charity says a mortgage rescue scheme would prevent homelessness among people struggling with mortgage payments.
Mortgage rescue is a way of converting an owner-occupied home into a social home so that it becomes affordable for the household, enabling them to remain living there as social tenants.
It has been successfully used in the past in Wales, with a previous scheme enabling around 600 adults and 300 children to keep their homes after the households were no longer able to afford their mortgage. However, there has been no funding for mortgage rescue since 2010 – and with repossessions on the rise, Shelter Cymru is calling for the scheme to be reinstated.
The Bank of England has predicted that around four million UK households will face higher mortgage payments in 2023, with the average monthly bill rising £250 – from £750 to £1,000.
Wendy Dearden, policy and public affairs manager for Shelter Cymru, said: ‘Most people can only imagine the stress of potentially losing a home, which they have emotionally and financially invested in.
‘The gauge on that stress moves ever higher each month as the arrears figures grow and the inevitability of the situation takes hold. But for a growing number, this is becoming reality.’
Mortgage arrears and repossession cases still, thankfully, represent a small proportion of the charity’s casework, but those numbers are beginning to rise.
The team dealt with 126 cases between August and November 2022, compared to 87 during the same period in 2021, representing a 45% increase.
Mum-of-three Amanda Lawrence (pictured above) nearly lost her family home in 2008, after becoming unwell. Thanks to a mortgage rescue scheme, the 51-year-old is happy in her home in Barry 15 years later.
She said: ‘It was the most stressful year of my life. I was spending all my time on the phone to the mortgage lender, explaining: “We can’t pay you. Please don’t evict us.”
‘We were constantly having to think about what we’d do if we lost our home. What would we put in storage? We were so overwhelmed. It was a very tense time for us.’
Amanda and her husband went to Citizens Advice and were referred to Shelter Cymru. Their caseworker suggested the mortgage rescue scheme.
She added: ‘Mortgage rescue saved our family. We were lucky, but I know of other people who have lost their homes. It’s heart-breaking.’