The Welsh Government has announced a new £40 million mortgage help scheme for households across Wales as part of its 2023/24 budget.

With things like energy bills, interest rates and cost of living expenses continuing to rise across the UK, struggling with mortgage repayments is a reality many households in Wales are currently facing. 

The Welsh Government has already provided more than £3.3 billion of support to help people struggling with the cost of living through targeted programmes across 2022/23 and 2023/24.

Now it is looking to target households struggling with mortgage repayments with its new Help to Stay Wales Scheme.

What is the Help to Stay Wales mortgage support scheme?

The Help to Stay Wales mortgage support scheme will work alongside support offered by mortgage providers through the UK Mortgage Charter to help customers who are struggling to afford their mortgage payments.

The Scheme will provide an option for homeowners who are at serious risk of losing their home by offering a partial repayment of an existing mortgage balance via a low-cost equity loan, secured by a second charge (behind first charge lender), reducing revised mortgage repayments to a level the applicant can afford.

The scheme will be operated by the Development Bank of Wales and will be interest-free for the first five years.

The purpose of the scheme is to reduce the number of homeowners at risk of repossession and homelessness by offering them time to resolve their underlying financial issues.

Around £40 million in repayable capital funding has been made available to provide flexible financial support for the scheme - which has been included in the Welsh Government's budget agreement with Plaid Cymru for 2023-24.

South Wales Argus: Application forms are now available online for the new Help to Stay Wales mortgage support scheme.Application forms are now available online for the new Help to Stay Wales mortgage support scheme. (Image: PA)

Minister for Climate Change, Julie James, said: "The current economic climate presents many challenges for homeowners as they face the significant rise in fuel costs, high inflation, escalating rent and house prices with incomes often not keeping pace.

"The aim of the Help to Stay Wales Scheme is to help homeowners to continue living in their precious homes.

"By widening our current mortgage rescue offer, we have the opportunity to help more people at an earlier stage before they face the awful threat of repossession."

Who is eligible for the new mortgage support scheme in Wales?

The Help to Stay Wales scheme will be available to people who meet all of the following criteria:

  • Your household is either in, or facing, mortgage difficulty and you are at risk of losing your home
  • The property is in Wales
  • The property is valued at £300,000 or less
  • The property is subject to only one existing legal charge by your first charge mortgage lender
  • The applicant is the owner of the property and it is their primary or sole residence
  • The total household income is not greater than £67,000 per annum

How you can reduce your energy bills

How to apply for Help to Stay Wales mortgage support scheme

Before you apply, you will need to speak to your existing lender to discuss your financial situation.

You will also need to speak to a free debt advice provider so that they can review your situation and provide you with a debt solution plan.

To apply for the Help to Stay Wales mortgage support scheme you must complete and submit the application form which is available on the Welsh Government website.

Application forms are available now.

If you have any further questions you can email applications@helptostay.wales.