The Government was due to announce details of The Home Owner Mortgage Support Scheme today.  The scheme was designed to stop people from losing their homes when hit by a sudden change in financial circumstances.

Unfortunately the government have confirmed that they are still locked in talks with participating lenders about the details of the scheme.

It is thought that the scheme may allow homeowners to defer mortgage interest for up to two years.  The full details of the scheme have been delayed until April says the communities department.

Many of the UK’s major mortgage lenders have been reacting to the recent 1.5% Bank of England rate cut.  With rates now at there lowest for 53 years and recent confirmation from the Bank of England that they are prepared to cut rates to zero to save the economy, lenders have been withdrawing and relaunching new tracker deals.

Tracker deals are directly linked to the Bank rate and recent figures show that tracker mortgages have been consistently growing in popularity.  Whilst most of the tracker deals still offer good value, the recently relaunched deals have increased the margin between the lenders rate and the bank rate.

Many of the better deals now have the additional restriction of larger deposits being required from borrowers, typically 25%.  Some lenders have also incorporated a ‘collar’ which means that should the bank rate fall below a certain level, the cuts will not be passed on to the borrower.  The major lenders appear to have positioned this ‘collar’ around 3% but as the lenders rates are normally around 2% above bank rate, this still represents good value.  Borrowers are still advised to be careful regarding collars.

Whilst the major lenders in Northern Ireland were quick to respond to the cuts, others have yet to announce if they will reduce there standard variable rate in accordance with the rate reduction.  The Governor of the Bank of England has confirmed that they are prepared to cut the rate to “whatever level is necessary” to boost confidence and stave off a long and deep recession.  This level of commitment from the Bank of England and the governments recent talks with bank executives, should encourage those stragglers to follow suit.