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Tough love on repossessions not the answer says Citizens Advice

28 June 2011

Responding to Richard Banks' comments today on rising interest rates, Citizens Advice Chief Executive, Gillian Guy said:

“Across the Citizens Advice service, we helped people with over 100,000 mortgage and secured loan arrears last year*.  Encouraging forbearance is absolutely right and necessary, with the current levels of unemployment and other economic challenges people are facing. A policy of ‘tough love’ would be short-sighted and unhelpful.

“Of course there will be cases where homeownership is unsustainable, but in that situation it is vital that those affected are helped out of home ownership in an orderly way and that they can get into secure rented accommodation with the least disruption possible. This is the key challenge for lenders and government.

“When lenders were not treating people fairly and failing to show forbearance** repossession proceedings were started when people were only a couple of months in arrears.Since then lenders have done a good job with customers facing difficulties but we are now starting to see poor practice creep backin.

“Anyone struggling to meet their mortgage repayments, or worried that they might have difficulties in the future, should get free independent advice straight away from somewhere like their local CAB.You have a greater chance of staying in your home if you seek advice early.”

*Bureaux helped with 103,487 mortgage and secured loan arrears problems between April 2010 - March 2011

**See our 2007 report Set up to fail: www.citizensadvice.org.uk/set_up_to_fail

Citizens Advice

Notes to editors

  1. The Citizens Advice service comprises a network of local bureaux, all of which are independent charities, and national charity Citizens Advice. Together we help people resolve their money, legal and other problems by providing information and advice and by influencing policymakers. For more information in England and Wales see www.citizensadvice.org.uk
  2. The advice provided by the Citizens Advice service is free, independent, confidential, and impartial, and available to everyone regardless of race, gender, disability, sexual orientation, religion, age or nationality. For online advice and information see www.adviceguide.org.uk
  3. Citizens Advice Bureaux in England and Wales advised 2.1 million clients on 6.9 million problems from April 2011 to March 2012. For full 2011/2012 service statistics see our quarterly publication Advice trends
  4. Out of 22 national charities, the Citizens Advice service is ranked by the general public as being the most helpful, approachable, professional, informative, effective / cost effective, reputable and accountable (nfpSynergy’s Brand Attributes survey, May 2010).
  5. Most Citizens Advice service staff are trained volunteers, working at around 3,500 service outlets across England and Wales.