Scottish Labour to unveil £50m 'rescue' plan for lower mortgage bills after interest rate hike

15.11.2022 - 08:17 / dailyrecord.co.uk

Scots Labour leader Anas Sarwar will today unveil plans to cut mortgage bills for homeowners struggling with spiralling interest rates.

The £50m “rescue” scheme would give the Government a stake in people’s homes in exchange for lower monthly payments.

Sarwar said: “Unless the Scottish Government steps in now to give urgent support to homeowners there is a real risk that repossessions could go up and people could end up homeless.”

Rising interest rates are forcing Scots to pay thousands of pounds more a year in mortgage costs, putting huge pressure on family budgets.

Around 30 per cent of households in Scotland owned their home with a mortgage in 2020 and an end to fixed rate deals could be disastrous.

At a launch in Glasgow today, Sarwar will release a new policy aimed at stopping people from losing their homes and making bills affordable.

An existing programme, Mortgage to Shared Equity, gives the Government a stake in someone’s home. Labour believes the scheme needs to be radically overhauled and expanded to help many more homeowners.

Central to the reform is widening the house price eligibility so that it is not only the lowest value homes that qualify. Labour would also allow homeowners who have bought their houses with smaller deposits and who are rolling off their fixed rates to qualify.

Another element would be a two month turnaround for applications. The equity would be returned to the Government over time.

Sarwar told the Record: “We are in the midst of a cost of living crisis where energy prices are going up, petrol prices are up, food prices are up, and we know people’s mortgages are also going up. There is now a Tory premium on mortgages.

“If someone is coming off a fixed rate and paying an extra £500 a month,