Will your credit card put your home at risk?

The Times article says:

“Already a harder line towards those failing to pay their debts is being taken by the high-street banks, which are increasingly going to court to secure their loans against a debtor’s house.

The number of “charging orders” has jumped from 13,000 in 1999 to 45,000 last year, with more and more people failing to make agreed payments to settle debts. A charging order means that, when a home is sold and the mortgage cleared, any money left over pays the outstanding bank or credit card debt. It also means that the creditor can apply to the courts for property, land and even a person’s shares to be sold to meet the debt.”

ClearDebt thinks this is a strange development – considering it’s from the same government that wants to introduce a simple, low-cost IVA (which we applaud) to make this debt-forgiving procedure more accessible.

We think many have got into debt because of the easy availibility of credit – this change will do nothing to persuade lenders to be more prudent.

See the Times article here.