Home protection for credit card debtors considered

05 February 2010 17:13:07

New rules could be put in place to protect homeowners from having their properties repossessed as a result of unpaid credit card bills, it emerged today (February 5th).

The Ministry of Justice (MoJ) has released a consultation paper to explore whether lenders should be permitted to force the sale of a home in order to call in debts below a minimum level.

Although orders for sale in relation to credit card debts are only issued in a minority of cases, the MoJ is looking to protect against a substantial rise as a result of the current economic climate.

"It's rare for a debtor to lose their home because of things such as unpaid credit cards," said justice minister Bridget Prentice.

"But it's important that the government considers whether there is a risk that the [economic situation] could result in more people losing their homes because of relatively low levels of debt which they are unable to pay."

Although Ms Prentice did not outline a specific threshold for debts owed, the Office of Fair Trading indicated that the level could be set between £5,000 and £10,000.

Meanwhile, the National Audit Office revealed this week that demand for the government's free debt counselling agencies increased by 28% in the year to July 2009.

‹ Back

All news articles

Product Offers
Please ensure that you fully read the terms & conditions of any product or policy before you decide to proceed and are fully aware of the total costs and the benefits and any exclusions or limitations applicable to the product or plan.

Please note that the product links will take you direct to the Issuer or Insurer's site direct and we cannot be held responsible for the information which they provide within their own sites. On some comparison tables we use a star rating which rates products by visitor popularity.