FSA calls for "fair treatment" of mortgage holders in arrears

Date:Wednesday 3rd December 2008
Author: Susanna Kavka

Mortgage lenders have been urged by the Financial Services Authority (FSA) to be fair towards borrowers who enter arrears.

Addressing the Council of Mortgage Lenders' annual conference, Jon Pain, retail markets managing director of the FSA, told lenders that repossession should be used only "when all other reasonable attempts to resolve the position have failed".

He instructed them to ensure their arrears policies were fair and being implemented properly, stating that fairness for struggling borrowers was "particularly important".

In addition, Mr Pain said that the terms and conditions for interest rate floors on tracker mortgages must be made "clear and unambiguous to the consumer".

Recently, mortgage broker Julia DeBattista told the BBC that under current conditions, those in her profession were doing "much more work for the same pay" as products are withdrawn and conditions changed.

She said that mortgage brokers sometimes go to close a deal only to find the lender has withdrawn the offer.