Help for homeowners in Middlesbrough

January 15th 2013

In 2003, Middlesbrough Council transferred its housing stock to a not-for-profit housing association, Erimus Housing.

It now owns approximately 10,500 properties across Middlesbrough and also delivers the Homelessness and Housing Advice services on behalf of the Council.

In 2011, Erimus Housing was approached by a couple who were having difficulties keeping up with their mortgage payments and had fallen into arrears.

The couple were both registered disabled and fell into difficulty with their payments after one of them had lost their job. The mortgage provider had issued proceedings for possession and following a court hearing the Judge had granted an extension of 28 days to allow the couple to attempt to resolve their financial situation. They were extremely concerned about losing their home and contacted Erimus Housing for advice and assistance.

Erimus’ Homeless Prevention Officer met with the couple to discuss their circumstances and talked through the options available to them. It was agreed that the best option would be to help clear the arrears and secured loan with an interest-free loan from the Repossession Prevention Fund. The Homeless Prevention Officer made a referral to the Five Lamps.

Middlesbrough Council contracted Five Lamps to administer the Repossession Prevention Fund. Five Lamps is one of the largest community-led social and economic regeneration businesses in the North East and takes a holistic approach as well as providing money advice, checking income and expenditure and issuing loans, it also offers advice and assistance on employment and self-employment opportunities.

On receiving the referral, John McCoy Five Lamps’ Loan Officer visited the couple at the first opportunity and was able to assess their situation. Having gone through their income and expenditure it was apparent that if their arrears and secured loan were cleared, they would be able to afford the mortgage payments on their current income. The loan of £4,000 allowed the Loan Officer to negotiate with the lenders for a full and final settlement of the arrears; both lenders agreed to the terms and the court proceedings were stopped.

The couple were delighted to be able to have kept their home and to have an affordable payment plan in place. They were thankful to everyone who had been there to support them through their difficult situation.

The Repossession Prevention Fund is an effective method of preventing homelessness. Since it started in March 2010, a total of 34 households in Middlesbrough have been assisted with an affordable interest-free loan, up to December 2012. This includes owner-occupiers in mortgage arrears as well as private and social rented tenants in rent arrears. The income that is received from loan repayments is recycled and used to issue loans to other households, it is anticipated that a further 20 households will be assisted through the current budget.

Between March 2010 and December 2012 the number of households that has approached Erimus Housing for advice and assistance due to mortgage or rent arrears is 240. In the same period, the number of cases where the Council has accepted a statutory homeless duty due to mortgage or rent arrears is 3.