CML recommends 'mortgage rescue'

The government needs to take action if it is serious about minimising the need for repossession, according to the Council of Mortgage Lenders (CML).

"Woefully inadequate" income support for mortgage interest (ISMI) payments needs addressing, according to the CML, and mortgage rescue schemes need to be more readily available to struggling borrowers.

A suggestion put forward by the CML is to give homeowners the opportunity to reduce the equity stake in their property, letting a landlord or housing association take on part of the mortgage debt.

The CML said: "While mortgage rescue is being adapted to current market conditions, it is not, in itself, a new idea.

"In the early 1990s, the government was keen to promote it as part of its response to the payment problems being experienced by mortgage borrowers at that time."

The number of repossessions in the second-quarter of this year rose to 39,078 - an increase of 24 per cent.

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