Could struggling homeowners get help due to new regulations?
Over the past year many homeowners have lost their homes to repossession as a result of falling behind on mortgage repayments as credit conditions have become more difficult and living costs have soared. With the financial markets and the housing markets in their worst state in decades the government has decided to take action and try and help struggling homeowners by bringing in new regulations relating to repossessions by lenders.
New court protocols will help to protect homeowners who fall behind with their mortgage repayments, and could save some from having their properties from being repossessed. The protocol was put forward by the Civil Justice Council and was recently approved by the Master of the Rolls. In addition to these regulations the government is also looking at bringing sale and rent back firms under the regulation of the Financial Services Authority in order to protect consumers from unscrupulous firms that go back on their word about tenancies or pay homeowners a fraction of the property value.
Under the new court protocol lenders will have to use court action as a very last resort when homeowners fall behind with repayments, and must first follow strict guidelines in order to try and resolve the situation. This includes discussing options available to homeowners to help them with their repayments, and trying to agree alternative terms with the borrower in order to get the situation sorted out. If the lender does take the matter to court officials will need to prove to the courts that all other steps have been taken and exhausted.
The Chief Secretary to the Treasury, Yvette Cooper, stated: “We need to make sure we help those who might be hardest hit in the tougher times ahead, ensuring repossession is the last resort not the first. We also want to make sure that vulnerable homeowners are protected from exploitation and dodgy deals.”
The Justice Minister, Bridget Prentice, added: “The new Civil Justice Council protocol forms part of a wider package of measures which demonstrate this Government’s commitment to provide the best possible support to debtors and vulnerable borrowers. The protocol sets out all the steps that a lender should take before issuing mortgage possession proceedings. Lenders will be expected to consider ways of resolving problems outside the court system so that mortgage possession claims are only brought to court after all other suitable options have been exhausted.”
Margaret Becket, the Housing Minister, said: “We must ensure that every avenue has been explored before lenders seek to repossess homes. These new measures will further protect the most vulnerable households in the current economic climate. We have expanded free legal representation in county courts for households at risk of repossession, we have provided more free debt advice and will continue to work closely with lenders through this difficult time. It is important that households who have concerns over their mortgage seek advice at the earliest opportunity, starting by speaking to their lender.”
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what home owners need is a direct home-pay-off through a goverment vocher or tax credit. most leanders want you to be 90 days behind your payments in order to put you in a fail situation because unless they are willing to allow you to re-finance with- out considering you credit score you are out of luck what, I cannot understand is why the goverment will not allow american tax-payers to share in the bail-out that most private sector is getting huge amount of help with our tax-dollars. why are the tax payers not being consider at all in this $700billion pay-off .