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Government promises help for buy-to-let tenants
Wednesday 14th January 2009Tenants renting buy-to-let properties are to get more protection if their landlord faces repossession.
The government has promised to work with court rule makers to secure a longer notice period for the tenants of struggling buy-to-let landlords.
Junior housing minister Iain Wright told MPs he planned to work with the Civil Procedure Rules Committee, the body which sets the rules for the civil courts, to give the tenants of struggling buy-to-let landlords up to seven weeks’ notice if their landlord default on their mortgage. The minister said: ‘At the moment, they only get about two weeks notice and that’s not fair.’
Mr Wright told Inside Housing the issue of tenants of struggling buy-to-let landlords losing their homes was a matter of great concern to him. He said: ‘It doesn’t seem fair if you’re not in arrears and your house is taken from under you. We need to provide as much security as possible.’
The minister was responding to a set of questions by Liberal Democrat economic spokesman Vince Cable, who quizzed him on the impact of recently-announced government measures such as the mortgage rescue scheme, which enables struggling homeowners to stay in their home as housing association tenants, and its mortgage support scheme, which enables them to defer mortgage payments, with the government acting as a guarantor if they default.
Mr Cable argued that the mortgage support scheme was being ‘very tightly drawn, in such a way as it excludes large numbers of people who might otherwise be eligible’.
And he argued that the 9,000 people predicted by the government to benefit from the scheme, coupled with the 6,000 expected to benefit from its mortgage rescue scheme, only made up a small portion of the 75,000 households that the Council of Mortgage Lenders has predicted will be repossessed this year.
Mr Wright said the government was ‘working night and day’ to ensure that repossessions are minimised as much as possible.
The number of repossessed buy-to-let properties shot up by 166 per cent in the third quarter of last year to 2,400, compared with 900 in the same period the previous year.