Citizens Advice policy officer, Peter Tutton, said its local bureaux were seeing increasing numbers of people falling behind with mortgage payments and, in some cases, being threatened with repossession.
The concern followed the publication of the Council of Mortgage Lenders’ (CML) repossession and arrears figures, which revealed repossessions had increased 30 per cent from the June 2006 findings.
Citizens Advice added that in the last financial year, in England and Wales, it had advised on over 57,000 problems relating to mortgages and secured loan arrears – an increase of 11 per cent on the previous year.
Tutton said: “Our evidence suggests lenders are sometimes taking repossession action as a routine response to arrears, instead of as a last resort. We want to see lenders making genuine efforts to reach agreement with borrowers on reasonable arrears repayment before taking court action.”
Christopher Dean, spokesman for the CML, commented: “Repossession is always a last option and lenders will always prefer to sit down with a borrower and come up with a new payment structure with them, as repossession can be a long process.
“Lenders are being less patient with people, but that makes sense, as they need to take prompt action and not let the situation go on. With a market of rising house prices, lenders know they will get their money back, but with talk of falling house price inflation, being less forbearant is a perfectly commercial stance to take.”
