1.4m home owners could have problems meeting mortgage repayments, according to the FSA’s recently published Financial Risk Outlook. This puts many more consumers at risk of having their homes repossessed. However the Consumer Panel is concerned that some consumers could lose their homes because lawyers and householders are largely unaware of the rules the FSA says must be followed before proceedings can be commenced.

The FSA’s rules say lenders must “treat customers fairly” and in particular:

• Lenders must make reasonable efforts to reach an agreement on repaying any arrears,
• adopt a reasonable approach to the timescale,
• not put excessive pressure on the customer,
• and repossess the property only where all other attempts to resolve the position have failed (Mortgage Conduct Of Business Rules 13.3.2; 13.5.3).

And in circumstances where a mortgage was mis-sold, we understand that the court can decide to stay possession proceedings whilst the Financial Ombudsman rules on the case.

John Howard, Chairman of the Financial Services Consumer Panel said:

"We have heard that some less scrupulous lenders are rushing to repossess properties without the courts considering the FSA rules on repossessions. And despite appalling stories of the misselling of mortgages, the sales tactics used are rarely taken into account in the court case. Clearly if a lender or mortgage broker has acted irresponsibly by persuading someone to take out a mortgage they cannot afford, a much more lenient view ought to be taken of the householder’s case."

– ends –

 MEDIA ENQUIRIES

1. The FSA established the independent Financial Services Consumer Panel in December 1998 to advise its Board on the interests and concerns of consumers and to report on the FSA’s performance in meeting its objectives. The Consumer Panel has statutory status.
   


2. The emphasis of the Panel’s work is on activities that are regulated by the FSA, although it may also look at the impact on consumers of activities outside but related to the FSA’s remit. More information about the Panel's work is available on this website.



3. The Consumer Panel brings together a wide range of relevant experience. This includes financial services regulation, working with vulnerable consumers, consumer protection, consumer education, front-line money advice, legal expertise, competition policy, public policy analysis, market research and media.



4. There are currently twelve members of the Panel as listed below (for further information on individual members, see the Panel's website – www.fs-cp.org.uk)

John Howard (Chairman)
Adam Phillips (Vice Chairman)
Kay Blair
Michael Chapman
Stephen Crampton
Caroline Gardner
Jenny Hamilton
Tony Hetherington
Nick Lord
David Metz
Lindsey Rogerson
Carol Stewart