Page last updated at 19:27 GMT, Tuesday, 12 May 2009 20:27 UK

Mortgage rescue claim is rejected

Donna Parsons
Ms Parsons believed the scheme would help her

A woman was rejected by the government's mortgage rescue scheme despite being the "perfect candidate", according to financial advisers.

Donna Parsons was told that under the Mortgage Rescue Scheme the government would buy her home, pay off her debts and rent her home back to her.

But despite showing four bank letters threatening repossession she had not been sent one from her mortgage lender.

"There is just no flexibility, it must be notice from the lender," she said.

Secured loans

Government paperwork confirmed a letter from the mortgage lender is required to comply with the terms of the scheme.

Ms Parsons had not received this because her mortgage lender is prepared to give her more time.

She and her ex-husband owe about £30,000 in loans secured against the house and it is those creditors that are demanding their money back.

Kim Watts from Yeovil Citizens' Advice believed Ms Parsons had done everything to avoid her house being repossessed.

"She'd sorted out her finances, we thought she was the perfect candidate," she said.

"If Donna doesn't qualify, I can't see who will. We had thought this would help lots of people who are getting into difficulties, but it looks unlikely now.

"It's a real shame," Ms Watts added.

So far one person has been helped by the £238m scheme, a government spokesman confirmed.

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