Debt advice: 'Homeowners need more protection from repossession'

09/02/2010

New guidelines on the repossession of homes could allow more people to use debt management plans instead of being forced to sell up.

The Ministry of Justice has announced a consultation on whether there should be a minimum amount of consumer credit debt which must be accrued before a court can order the sale of the debtor's home.

Justice minister Bridget Prentice said that the consultation had been called because the current economic situation "could result in more people losing their homes because of relatively low levels of debt which they are unable to pay".

Al Elliot, co-owner of the Home-owners Advice Centre, commented: "[The proposals] would therefore provide those homeowners who are genuinely trying to repay their debts a good degree of protection from further, likely unjustified action."

Proposals to protect the consumer were also set out by the Financial Services Authority in January, which included plans to force firms not to add monthly arrears charges when an agreement has been made to repay the arrears.

Posted by Fiona Smith

Tags; Housing Debt and Bills,

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