'Help needed' for owners
02 May 2008
As the numbers of homeowners hit by mortgage arrears and repossession grow, Shelter is calling on the Government and mortgage lenders to set up a free, confidential advice service to support those affected by the crisis.
The call for a special arrears 'one stop shop' comes as figures show more than one million households could face repossession over the next year - 80,000 people have already sought help with mortgage problems from Shelter in the last year, up 10,000 from 2006.
Chief executive Adam Sampson said: 'Shelter has seen a massive increase in people coming to us with mortgage problems, and with repossessions set to rise throughout this year, we simply haven't got the resources to help everyone.
'The Government, mortgage lenders and the Financial Services Authority must take responsibility and start repairing the broken state safety net to ensure that if people face difficulty, there is protection in place and somewhere to turn for advice.'
The service would provide early stage advice to people facing difficulty paying their mortgage, through a telephone helpline and online support.
In addition, mortgage lenders would be obliged to provide details of the service to all customers. The recommendation follows a repossession action plan, published today in a new document by Shelter. Other recommendations include:
- The Financial Services Authority (FSA) must clamp down on irresponsible lenders who sell customers unaffordable products and are too quick to repossess properties from homeowners in arrears.
- New guidance should be issued to county court judges, so they take a tougher line against mortgage lenders who treat customers unfairly.
- A national mortgage rescue scheme should be set-up to allow homeowners in difficulty to remain in their home, without the drawbacks of privately run schemes.
- The Government must urgently strengthen the current inadequate state safety net for homeowners, which allows too many to fall through the gaps. As a first step forward, it should consider Joseph Rowntree Foundation's Sustainable Home Ownership Partnership (SHOP).
Mr Sampson added: 'Instead of helping struggling homeowners get back on their feet, the actions of some lenders, combined with a lack of Government support, simply exacerbates their problems and condemns them to the despair and misery of losing their home.
'A free and impartial advice service is a much needed first step to stop mortgage arrears and repossessions escalating and help thousands of ordinary people keep a roof over their heads.'
