Darling wants banks to help vulnerable families
Chancellor of the Exchequer, Alistair Darling, has recently announced that he wants banks to do what they can to help the more vulnerable families in the country, stating that banks need to help struggling homeowners in order to reduce the risk of rocketing repossession levels. Both Darling and the Housing Minister, Caroline Flint, have stated that banks need to give more time to families that fall behind with their repayments.
Darling went on to state that given the huge cash injection that the Bank of England has put into the money markets, along with the recently announced £50 mortgage rescue plan, taxpayers should expect this sort of assistance from banks. A recent report has shown that repossession order levels have increased over the past three months compared to the last three months of 20007, and many expect these figures to continue rising over the course of the year.
The Chancellor also expressed concern that many lenders had increased the cost of borrowing for consumers despite three interest rate cuts from the Bank of England since December. One of the suggestions that was put forward was the possibility of mortgage repayment holidays, which could increase flexibility for homeowners during months where finances were particularly overstretched.
Banks and building societies responded to Darling’s speech by stating that they already offer help to struggling homeowners in terms of coming to arrangements over arrears, but they did add that they were willing to go further in order to try and curb repossession levels. Banks are being asked to provide immediate help and assistance to those unable to meet their mortgage repayment, and wherever necessary to extend the term so that the monthly payment can be reduced.
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