The Financial Services Authority (FSA) is keen to ensure that lenders are treating customers fairly. This means that borrowers who fall into arrears should not face a raft of arrears charges, plus interest, and where lenders have agreed an arrangement for the borrower to repay the arrears, the lender must not then apply a monthly arrears charge. Payments to firms must first be allocated to clearing the missed monthly payments rather than to arrears charges.
Repossession, which is so devastating for anyone who has to go through it, should be viewed as the last resort, says the FSA. And all lenders will be obliged to record all arrears handling telephone calls and to keep all records for three years.
These proposals should ensure that the most vulnerable homeowners who get into financial difficulty are treated fairly and can avoid homelessness. They must be implemented as soon as possible.
Those who do find themselves in difficulty when it comes to paying their mortgage should seek advice from their broker or lender as soon as possible – preferably before they miss a payment.