Citizens Advice slams sub-prime lenders

A report from the Citizens Advice charity has suggested that the practices of some of the UK’s sub-prime mortgage lenders have forced thousands of British borrowers into serious debt management trouble.

Mortgage arrears, repossessions and court actions are all on the increase around the country and Citizens Advice is convinced that in many cases the blame lies with sub-prime lenders.

Furthermore, some of the most disadvantaged people in the UK are among those most vulnerable to being mis-sold a particular mortgage deal or borrow money on the basis of unsound ‘sub-prime’ advice, the charity’s report makes clear.

“Many sub-prime lenders are flouting the rules on responsible lending by granting loans when it’s clear the borrower will not be able to afford to repay it from the very outset, then getting tough immediately things go wrong,” said Citizens Advice chief executive David Harke.

“Far from providing housing security and a valuable asset, home ownership has proved a fast track to debt and homelessness for many vulnerable borrowers on low incomes.”

Last month, Citizens Advice called on the British business community and regulatory bodies to do more to arrest the rising prevalence of debt management problems in the UK.