Pre-action protocol 'not being followed'

15/12/2009

Extra government help to prevent vulnerable homeowners from falling victim to repossession is needed, an alliance of charities has said.

AdviceUK, Citizens Advice and Shelter praised existing state support, but called for more radical measures to be implemented in future.

Data from the Council of Mortgage Lenders suggests that 47,000 homes will be repossessed in 2009.

In 2007, before the onset of the recession, this total stood at 27,000.

Analysis from the charities showed that, for one in three recent repossession cases, the lender had not complied with a government measure known as the "pre-action protocol", which requires legal proceedings against borrowers to only be taken as a "last resort".

These failures were found to be still more severe among sub-prime lenders.

Alternatives to repossession proceedings for lenders include the renegotiating of the terms of the mortgage contract with the borrower, in order to give them extra leeway to make their repayments.

In this way, the homeowner would be less likely to fall into arrears.

Commenting, Citizens Advice chief executive David Harker said: "Government, lenders and regulators have taken swift and welcome action to protect people affected by the recession from losing their homes unnecessarily.

"Our advisers see evidence of these initiatives working in many cases, but our research makes it clear that the safeguards already in place to protect people from avoidable homelessness need to be strengthened if they are to succeed in stemming the rising tide of repossessions."

Tags; Housing Debt and Bills, Young Family Finances, Recent Graduate Debt,

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