Northumberland's Reposessions Prevention
Fund
Background
In 2009 the Government announced a £20 Million
fund to enable local authorities to extend small loans to families
at risk of homelessness through repossession or eviction. This £20
million resource is in addition to the extra £80 million capital
which was also announced in the Budget to enhance the Mortgage
Rescue Scheme (MRS).
The Scheme
Northumberland County Council (NCC) has been
allocated £76,000 to fund the scheme as a one off payment in
addition to the Homeless Grant award. The emphasis of the scheme is
to ensure that the maximum numbers of households in need of
financial assistance are supported to remain in their homes. For
example, it could be used to clear mortgage or second charge
arrears in appropriate cases, where this would prevent
homelessness
Financial assistance through small loans
(where possible) allows the money to be recycled to help other
households in the local authority area in the future. In addition
to helping homeowners struggling with their mortgage costs, this
funding can be used to help tenants in the social or private rented
sectors who, through no fault of their own, are struggling with
their rental payments in the current climate and face eviction.
The fund is not intended to fully clear rent or mortgage
arrears but to recover the position where all other options have
failed
Loans will be offered ranging from £1,000 to
£3,000 per household. Any loan will be capped at £5,000 and is
conditional on the household seeking money advice with CAB. All
loans are available at 0% interest
Both the Northumberland Credit Union and the
Credit Union South East Northumberland have agreed to administer
the loan on behalf of the County Council. The Citizens Advice
Bureau (CAB) will work between the Council’s housing options
advisers and the Credit Unions to assess customers eligibility for
the scheme.
Who is eligible to apply?
Applicants will be interviewed by either a
Housing Options Adviser or a CAB generalist adviser. They will make
enquiries to establish that the customer meets all of the following
criteria to apply for a loan:
- Eligible for assistance – homeless priority
need category i.e. Household with dependent children, Household
member pregnant, Physical or mental health issues, Vulnerable due
to old age, Fleeing domestic violence
- Threatened with homelessness due to
circumstances beyond their control
- Believed to be in priority need
- No issues of becoming homeless
intentionally
- Resident in the County of Northumberland
Enquiries will include whether the applicant
has previously been assisted by the Council, or been found
intentionally homeless or has rent arrears outstanding from past
addresses, as these circumstances may affect their eligibility for
assistance from the Repossessions Prevention Fund.
If someone is eligible what happens next?
Once it is established that the applicant
qualifies for the scheme the CAB Money Adviser will then carry out
a full financial assessment, negotiating with the mortgage company,
landlord, and creditors as appropriate. Together with the credit
union the Money Adviser will satisfy that the applicant will be in
a position to repay the loan.
The amount of the loan and the period over
which the loan can be repaid will be set according to the
applicants individual circumstances. All loans will be treated as a
conventional credit union loan; except it will be interest free and
all applicants will become a member of the credit union and be
expected to save a small amount during the period of the loan.
How do people apply?
You must make your application for the
Repossessions Prevention Fund through your local Homeless and
Housing Options Service or your local Citizens Advice Bureau.
For details of your local Homeless &
Housing Options Service please contact us on 0845 600
6400.
Details of your local CAB can be found at
http://www.citizensadvice.org.uk/%20
Households in financial difficulty, at risk of
repossession and threatened with homelessness should seek advice
from their lender in the first instance. Further advice and
support will be available from your Homeless and Housing Advice
Service, local Citizens Advice Bureaux or other advice and support
agencies.
Referrals to a local housing authority can
also be made by advice agencies, courts or lenders.
