HC Deb 20 February 1992 vol 204 cc233-4W
Mr. Austin Mitchell

To ask the Secretary of State for the Environment if he will make a further statement on his discussions with mortgage lenders and insurance companies on mortgage repossessions; and when he intends to introduce a scheme.

Mr. Yeo

My right hon. Friend the Chancellor of the Exchequer announced on 19 December that agreement had been reached with mortgage lenders on a package of measures. The package included pledges by lenders of £750 million for rescue schemes to help borrowers in difficulty, with the expectation that up to £1 billion would be available if necessary.

Lenders are now coming forward with details of schemes. Six lenders have so far announced schemes—Halifax building society, Nationwide building society, Leeds Permanent building society, Bradford and Bingley building society, National Westminster Home Loans and the Mortgage Corporation. Others are expected to follow soon. Lenders are also introducing improved counselling arrangements for borrowers and have given a commitment that no action will be taken to repossess properties while borrowers are making significant regular payments.

The Chancellor also announced that the Government would introduce legislation for the temporary suspension of stamp duty on transactions up to £250,000 and for the direct payment to lenders of sums allowed for mortgage interest in income support. Both these measures have now passed their Commons stages.

The combined effect of these measures is expected significantly to reduce the number of repossessions this year.