Extra home protection considered for debtors - Credit cards - News - Moneyfacts


Moneyfacts.co.uk News brings you the latest financial & economic news & reviews of the best products in the UK by our team of money experts.

Extra home protection considered for debtors

Extra home protection considered for debtors

Category: Credit cards

Updated: 09/02/2010
First Published: 08/02/2010

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Homeowners facing the possibility of losing their property as a consequence of failing to repay consumer credit debts could be afforded a greater level of protection, if new proposals get the go ahead.

At present, property owners who have unsecured debts such as credit or store cards, which they have been unable to pay, can have a charging order placed against their property to secure the debts.

In a small number of cases, the charging order is followed by an order for sale, meaning the property has to be sold immediately to settle the debt.

However, the Ministry of Justice is considering whether new rules should be introduced that would mean a minimum level of debt would have to be accrued before the enforced sale of a home could be ordered.

"There are currently a number of safeguards in place to protect homeowners, while ensuring the creditors who need to recoup their money are able to do so," said Justice Minister Bridget Prentice.

"But it's important that the Government considers whether there is a risk that the numbers will increase due to the current economic situation, and whether this could result in more people losing their homes because of relatively low levels of debt which they are unable to pay."

The consultation period will last until 30 April 2010, after which a final decision will be made.

Compare 0% purchase credit cards

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

Related Articles

Credit card mistakes cost borrowers £948m

At this time of year, many people could be turning to balance transfer credit cards in an attempt to overcome their Christmas debt. However, many of these borrowers could get caught out in the year ahead, and they could end up paying for it.

6 of the best balance transfer credit cards

Does the thought of opening your credit card bills fill you with fear? If so, you're not alone! Christmas may be over, but unfortunately, many people will still be paying for it, after turning to credit to cover the cost of their festive spend.

Get a better credit score for the New Year

A new year means a fresh start, and one of the best things you can do is take a cold, hard look at your finances – particularly when it comes to your credit score.