Judges in the UK being armed with new guidelines to curb property repossessions

Posted under General by Michael

The alarming increase in repossessions of properties in the UK due to non-payment of mortgages has prompted issuance of new guidelines to the judges by the Government to prevent deliberate seizure of properties by the lenders.

Under the new guidelines mortgage providers will be required to satisfy the court that they tried different alternatives, such as changing the type of mortgage, extending the length of mortgages and repayment holidays, but failed and repossession was the last alternative left for recovery of money.

If lenders and building societies failed in demonstrating that repossession was the final option and no other solution could be worked out, court judges are empowered to prevent or adjourn repossession as per new guidelines.

The measure has been welcomed by the Council of Mortgage Lenders which provides 98% of residential lending in the UK. According to Director General Michael Coogan, general public was deeply concerned about repossession.

The Council has asked its members, through new guidance, to reassure consumers that lenders were genuinely committed to use repossession option only as last resort and that measures to ensure protection of consumer interests were in place.

Citizen Advice Bureau has asked all people experiencing problems in making payments, to seek its advice at the earliest. Bureau’s director of Policy Teresa Perchard, while welcoming the guidance stated that it would be a good yardstick for practical treatment by lenders to their borrowers and money advisers.

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