FSA help for homeowners in arrears

The Financial Services Authority, the City watchdog, is proposing a clampdown on the charges that lenders levy on customers who are in arrears, as well as stressing that they must only consider repossessing a home as a last resort. The latest round of proposals comes after problems with the way specialist lenders and third party administrators were handling people who fell behind with repayments. Lenders have also come in for heavy criticism over the fees they levy on homeowners who are in arrears, with some groups charging £150 to people for a visit by a debt counsellor, or £300 for instructing a solicitor. Borrowers can also be charged£60 a month in fees even once they have come to an arrangement with their lender about repaying the arrears. Under Tuesday’s proposals, firms will no longer be allowed to apply monthly arrears charges to consumers when they have agreed a repayment plan