The money will be used to help Scottish citizens that are financially struggling to find solutions to their debt problems, especially those going through the courts that face losing their homes.

The £7.2m, which comprises a Scottish Government donation of £4.8m and a Money Advice Service donation of £2.2m, will be split between a variety of Scottish schemes until 2015. Seventeen projects have already benefited to date, including Citizens Advice and the housing and homelessness charity Shelter Scotland.

Lindsay Montgomery, SLAB chief executive, said: “We appreciate the financial support from both the Scottish Government and the Money Advice Service for this significant programme of grants. The projects will play an important role in helping find long-term solutions for people struggling with financial difficulties by dealing with the underlying debts that are often the root cause of housing problems. Spread across Scotland, they will be seeking solutions that prevent homelessness and try to put in place sustainable debt solutions.”

Shelter Scotland’s project on housing law and debt advice, which has helped over 700 families in the Tayside, Central and Borders regions, is set to receive £755,380 of the funding. Families or individuals facing repossession or eviction will be provided with legal advice while a negotiator helps those with debt create payment plans with lenders.

Eleanor Hamilton, Principal Solicitor at Shelter Scotland, said: “It’s great news for people in Tayside, Central and the Borders who are in danger of losing their home through repossession or eviction, or in desperate need of money and debt advice. We thank the Scottish Legal Aid Board for funding this service which has proved very successful over the last two years, especially as the effects of recession and welfare benefit reforms have started to hit home.”

The Scottish people have among the highest levels of personal debt in the whole of the UK and the Scottish Government has committed itself to ensuring that citizens struggling with debt get the help to deal with it they need, especially if it threatens their homes or leaves them facing eviction from rental properties.

A spokesperson for Trust Deeds Scotland supplier, Scottishtrustdeed.co.uk said: “This is good news for Scottish Citizens that are living with the immense stress and fear that debt creates when it threatens their homes. Many debt-related housing problems can be avoided with the right advice at the right time and this £7m funding will ensure those in most need of help will be able to keep their homes and sleep easy.”