07 September 2007
Borrowers who struggle to meet mortgage repayments and end up in arrears could be hit harder than they first think.
Research from Moneysupermarket.com found that missing mortgage repayments can generate a large number of punitive charges that vary according to provider.
The company looked at many of the most popular mortgage providers' charges, finding noticeable differences in their fees.
While Moneysupermarket found that Northern Rock and Accord customers are given one month's grace for missing their repayment, GMAC will automatically charge £50.
Louise Cuming, head of mortgages at moneysupermarket.com, said: "While I would not condone missing a mortgage repayment often financial hardship is caused by circumstances outside the control of the borrower, such as a relationship split. It is fair to say those in the unfortunate situation of going into arrears can expect to face some highly punitive and unjust charges.
"We must question if these lenders are 'treating customers fairly' given the inconsistency of the penalty fees charged. Under the Mortgage Conduct of Business rules, regulated by the Financial Services Authority, all cases of financial hardship must be treated sympathetically."
She also noted that rising interest rates were impacting homeowners - with recent figures from the Council of Mortgage Lenders (CML) showing an increase in properties taken into possession.
If Either you or your partner are in need of Debt Advice or a Debt Solution, Then CLICKTo Apply Today!
