Loan purchaser and housing body agree mortgage-to-rent deal
Promontoria and Home for Life to contact up to 400 distressed mortgage holders
The number who could avail of the mortgage-to-rent scheme could rise to several thousand over an extended period. Photograph: iStock
Thousands of distressed mortgage holders in danger of having their homes repossessed look set to be thrown a lifeline after a so-called vulture fund reached an agreement with a housing body to move people into a mortgage-to-rent scheme.
Loan purchaser Promontoria has been working with Home for Life for months and will begin writing to borrowers in long-term arrears later this week as a campaign to engage with borrowers who may be eligible for the mortgage-to-rent scheme gets under way.
As many as 400 borrowers will be contacted as part of the initial campaign to engage with potentially eligible borrowers. Some existing cases have already progressed to the legal conveyancing process and are due to close in the coming weeks.
The number who could avail of the scheme could rise to several thousand over an extended period.
Commenting on the development, Home for Life chief executive Paul Cunningham described it as “a significant and very positive development for borrowers whose mortgages are serviced by Link Asset Services”.
“We have been working with them for a number of months to provide this solution to borrowers who are in difficulty to ensure that they do not lose their homes.”
Mr Cunningham said it was “never too late to engage and as testament to this [the financial institution] are specifically targeting borrowers where repossession orders have already been granted as part of the initial tranche of letters issuing to customers this week.”
He said the development was “hugely positive for all borrowers in mortgage difficulty”.
To qualify for a mortgage-to-rent scheme, first a customer’s mortgage debt must be deemed unsustainable.
Ownership of the customer’s home then transfers to Home For Life and the customer becomes a long-term tenant of Home For Life. Any remaining residual mortgage debt, following property sale, is fully written off.
The customer has the option to buy back their home, at any time, at an agreed price.