Polls and surveys show that most homeowners are able to manage their mortgage and other housing costs reasonably comfortably, and many are sitting on a potential capital gain which they may be able to access later in their lives to fund their retirement or
But a minority struggle to meet their monthly outgoings and live in fear of an interest rate rise or redundancy or reduced hours at work that could tip them over the financial edge.
Getting good and – crucially – independent advice as early as possible is important for
these families. The National Homelessness Advice Service, a partnership between Shelter and Citizens Advice, is a crucial resource. It provides local authority front-line staff with
specialist support, information and expertise so that advisers can in turn provide accurate and timely housing advice to residents, and it has a specialist team of mortgage debt caseworkers who can advise on homeowners in debt.
For some, better management of their debts and bills can make all the difference and help them stay in their home. But for others, homeownership becomes unsustainable and there comes a point when a decision needs to be made to give up the home and get out of the debt before an enforced repossession takes place.
Research for the charity by the University of York has explored the various routes open to
struggling homeowners and the support provided by lenders, especially to help people to sell their properties voluntarily. The process, known as assisted voluntary sale (AVS) is a relatively new development in the sector and is not available from all lenders, but can deliver positive results that can benefit both lenders and borrowers. If it is a suitable option, it can enable the homeowner to keep control of the sale process and provide time to calculate the financial pros and cons and consider options for alternative accommodation, including if necessary a local authority homelessness application.
Shelter and NHAS have now published a good practice guide to AVS to help people and their advisers through the process. There can be few harder decisions for a family to make and the guide goes step by step through the options available and the factors to take into account.
If economic circumstances worsen, unemployment rises further, or there is a sudden lurch in interest rates, this guide might prove to be an increasingly valuable tool.