CML urges government to renew its commitment to home-owners

20 Nov 06

The Council of Mortgage Lenders today urges the government to increase support for mortgage borrowers who fall into payment difficulties and renew its commitment to sustainable home-ownership - with an aim of enhancing the safety-net for home-buyers and minimising the numbers of arrears and repossessions.

In its pre-Budget report, the CML points out that more than half the UK's poor are home-owners, but the government's safety-net measures are strongly tilted towards people in other forms of tenure. The CML believes that one way the government can redress this balance is by increasing the £100,000 maximum mortgage sum eligible for income support for mortgage interest - a benefit that can help pay the interest on the mortgage of a struggling borrower. This threshold has not been increased since 1995, so the overall level of support available for home-owners is currently at its lowest level for over 20 years.

The CML's pre-Budget report also urges the government to:

Reform the current ''slab'' structure of stamp duty. The current system creates inefficiencies in the housing market and undermines the government's efforts to get would-be home-owners on to the property ladder.
Ensure there are enough energy assessors to deliver the energy performance certificate part of home information packs. If there is a delay which causes a shortfall in the number of assessors it could impact on the delivery of the packs and ultimately have a negative effect on the market.

Commenting on today's proposals, CML head of research and information Bob Pannell said:

"Home-ownership is far and away the most popular tenure in the UK. But it is surprising that at a time when the government is promoting the wider benefits of home-ownership, the safety-nets it has in place to help struggling home-owners are being neglected."

"We strongly urge the government to demonstrate its commitment to sustainable home-ownership by reviewing how the benefits system helps home-owners who find themselves in difficulty."

Notes to editors

1. The Council of Mortgage Lenders' members are banks, building societies and other lenders who together undertake around 98% of all residential mortgage lending in the UK. There are 11.6 million mortgages in the UK, with loans worth over £1 trillion.