McLean’s Financial Services

Help for struggling homeowners

Under new rules brought in by the government on 22 October aimed at reducing repossessions, mortgage lenders will have to prove they have tried to help struggling homeowners avoid losing their property.
As the credit crisis spreads from the financial sector into the rest of the economy, Britain is expected to enter its first recession since the early 1990s.

The housing market is already slumping fast and English and Welsh courts ordered more home repossessions in the second quarter of this year than at any time since 1992.

Lenders seeking a repossession court order under the new rules will be expected to show they have tried to find alternatives when borrowers get into trouble with their mortgage repayments, the Treasury said.

‘We need to make sure we help those who might be hardest hit in the tougher times ahead, ensuring repossession is the last resort not the first,’ said Chief Secretary to the Treasury, Yvette Cooper.

‘We also want to make sure that vulnerable homeowners are protected from exploitation and dodgy deals.’

The government also wants the Financial Services Authority to regulate firms that buy property cheaply from those struggling to keep up with their mortgages and then rent it back.

Your home may be repossessed if you do not keep up repayments on your mortgage.

For more information or to discuss anything in this article feel free to contact Doug McLean via email or phone.