A LONG-PROMISED £1bn scheme to help recession-hit families avoid repossession by deferring part of their mortgage repayments will get under way today.

Homeowners who lose their jobs, or are forced to take lower-paid work, will be able to suspend up to 70 per cent of their mortgage interest payments for up to two years, Gordon Brown will confirm.

The Prime Minister pledged last year that the payment holiday would prevent anyone losing their home who “demonstrates to their bank a willingness to pay”.

But criticism has grown as the scheme – originally due to start in January – was delayed after negotiations with major mortgage lenders dragged on.

Meanwhile, the Council of Mortgage Lenders (CML) has warned that repossessions are on course to soar to 75,000 next year – very close to the peak of 75,500 reached in 1991, during the last recession.

Furthermore, only some high street lenders will begin offering help under the Homeowners Mortgage Support (HMS) scheme from today, with others expected to sign up “very shortly”.

The payment holiday is significantly less generous than Mr Brown suggested in December, when he pledged the Government would underwrite up to 100 per cent of interest payments.

It means homeowners will have to find at least 30 per cent of the interest each month.

They will only qualify for help after making regular payments for at least five months, on mortgages up to £400,000.

Nevertheless, Mr Brown will argue that the initiative shows the Government doing “everything it can” to help people through the recession – in sharp contrast to the Tory approach through previous downturns.

A Government source said: “From tomorrow, borrowers who suffer a temporary loss of income will be able to apply to major high street lenders to cut their mortgage interest payments for up to two years to help them get back on track with their finances.

“For example, the scheme could benefit a household who have had working hours reduced or overtime cut, or perhaps had two incomes and are now relying on one pay packet at the moment.”

Figures released in February, which revealed a rise in families on the brink of losing their homes across the region, suggested the scheme is badly needed. County courts reported 4,356 repossession orders made by lenders against householders unable to pay their mortgage bills in three months, a 17 per cent increase on a year earlier.

The leap in seizure orders, in the last quarter of 2008, was much higher in some areas – including Teesside (41 per cent), York (35 per cent), Skipton, in North Yorkshire (29 per cent), and Scarborough (51 per cent).

Mr Brown, who, in December, said eight key lenders had already signed up, has been accused of an attempt to “grab the headlines” and falsely raising the hopes of people who only now can apply for help with their mortgages.