From the information you give, and the fact that you have moved house, it looks to me as if the collection trail has gone cold.(posted 7259 days ago)You don't say who your lender was - if it is one of the CML members, then they have a voluntary code that they will not chase for shortfalls after 6 years which of course for a repossession in 1995 has been exceeded. Other lenders who are not CML do chase for 12 years after which the debt is statute barred.
The problem is that if you do acknowledge the debt and try to get a settlement figure, you restart the collection clock (i.e. the 12 years starts again (if 12 years applies that is).
As to the council question - I would put no to the bit about having a home repossessed. You will ony have to put your current and previous address and so long as there are no judgments or CML data against either property, you will be OK. Get a copy of your credit report from Experian and Equifax (both of which you can do online) and check your credit history to be sure - if they are clear - get on with it and get that house bought before the right to do so disappears as most labour councils are against disposals of council property!
Good luck