FSA offers glimmer of hope to borrowers
Commenting, he said: “With unemployment running at a 13 year high of just under 2.5 million, there will be a lot of people struggling to meet their mortgage repayments due to circumstances beyond their control.
“To have an additional £30 or £40 monthly arrears charge added to your mortgage balance, despite having agreed a repayment plan with your lender, was merely compounding the problem and yet another kick in the teeth for those doing their utmost to stave of the threat of repossession.
“It’s hardly treating customers fairly for lenders to generate additional profits by charging arrears fees to people who are adhering to temporary reduced repayment plans.
“The consultation paper from the FSA proposing that no charges are incurred where a formal agreement between lender and borrower is in place will be welcome news to thousands of genuine people who are battling to keep a roof over their heads.
“With 194,600 mortgages in arrears by 2.5% or more of their outstanding balance (CML end of Sept 2009) these proposals will bring a collective sigh of relief from households the length and breadth of the UK.
“The FSA has also stated that repossession must only be considered once all other avenues have been exhausted, and whilst it’s too little too late for the estimated 48,000 people who lost their homes in 2009, at least it gives a fighting chance to thousands others who are doing everything they can to hang on to their family home.”