Repossession rules tightened

New protection for people struggling with mortgage arrears, by further tightening the rules on lenders taking court action for repossession, has been announced.

John Healey, the Government Housing Minister, has written to Rochdale council saying that when they hear from lenders taking repossession action against local people this should prompt them to offer practical advice or support for residents struggling to keep their homes.

This could include directing them to free debt and legal advice, helping them apply for benefits such as Support for Mortgage Interest or, for the most vulnerable households, assessing them for the Mortgage Rescue Scheme – part of the comprehensive range of support that the Government has put in place at every stage of the repossessions process. Over 300,000 people have benefited from financial help and advice with their mortgage since April last year.

The new rules come into force on 1 October.

Councils are already playing an active role in providing impartial advice and support. This week’s changes will ensure councils can take early action, rather than waiting for worried homeowners to call.

These moves are on top of action in the courts to ensure lenders must prove they have exhausted every possible option before applying for a repossession order, and a new national advertising campaign pointing people concerned about their mortgage payments to seek practical help to take control of their finances.