Citizens Advice: Lenders should to more to help those in arrears

People with debt management issues that could land them in mortgage arrears should receive more help from lenders, Citizens Advice has said.

The comments follow research released by the Council of Mortgage Lenders (CML) last week showing the numbers of people facing mortgage arrears and repossessions this year is increasing.

Citizens Advice said: “To prevent the mortgage crisis deepening, it is vital that all lenders do everything in their power to help people avoid losing their homes.”

Those in debt should be treated “fairly and sympathetically” while court action should only be used when there are no other alternatives.

Additionally, the organisation has called on the government to bring in a “pre-action protocol” to prevent borrowers in trouble being taken to court unless it is as a last resort.

The CML said the proportion of all mortgages where homes were repossessed rose from 0.11 per cent in 2007 to 0.16 per cent this year so far. Those with arrears of more than three months went up from 1.1 per cent at the end of 2007 to 1.13 per cent halfway through 2008.