The Welsh Assembly Government is providing up to £5 million extra for their mortgage rescue scheme to stop homeowners who face repossession from being made homeless.

Deputy Minister for Housing Jocelyn Davies said that additional money was being set aside as a response to the growing number of homeowners who now face difficulties as result of the "credit crunch".

Under the scheme, grants can be used by Housing Associations to buy a share of the mortgage or buy properties outright and then rent them back to the former owner.

The funding is intended as a last resort measure and will deal with the most urgent cases which would otherwise result in homelessness, giving rise to additional pressures on social housing waiting lists and use of temporary accommodation.


Ms Davies said: "The position that a growing number of home owners are finding themselves in is one where they unable to meet the payments on their mortgage and facing repossession proceedings, this is of great concern to me.

"There are serious consequences when a family loses their home and becomes homeless, children have to move schools, and the health and wellbeing of all family members can often deteriorate. I am therefore expanding the existing scheme in order to help significantly more families finding themselves in these circumstances.

"By working with local authorities and housing associations, families facing homelessness may be able to access our mortgage rescue scheme, where a housing association can either purchase the home outright so that the home owners then become assured tenants, or can purchase an equity share where the mortgagees can afford a smaller loan."

She added that the scheme was in line with the Assembly Government's One Wales commitments to develop a 10 year homelessness Strategy and to cut child poverty in Wales.

(CD/JM)