Rock chiefs hold talks over home loss worries
Oct 31 2008 by William Green, The Journal
NORTHERN Rock will meet campaigners who have expressed concern about its “aggressive” repossession policy, Treasury Minister Yvette Cooper told MPs yesterday.
She said the state-owned bank would be meeting with some of the charities which had raised concerns, adding that the bank had particular issues about its Together mortgages, which were effectively for more than 100% of the value of properties.
But Ms Cooper stressed it was right that the lender was run at arms length and on a commercial basis after Northern Rock was criticised by housing charity Shelter for an aggressive repossession policy.
She said: “I actually think it is right that all lenders, not simply the lenders that got support from the recapitalisation scheme, should do everything they can to make repossessions properly a last resort and not a first resort.
“And that is why we have introduced new court rules in order to strengthen the procedures to ensure that borrowers who get into difficulties can be offered other alternatives and other support as well.”
That could mean repayment holidays or looking at different mortgage rescue schemes, backed by extra Government funding.
Tory spokesman Mark Hoban told Ms Cooper: “Last week you said you wanted repossessions to be a lot rarer.
“Yet despite reassurances last year about the quality of its mortgage book, Northern Rock is repossessing more homes than any other lender.
“Are you saying those reassurances you gave last year are wrong or are your demands just hot air?”
A Northern Rock spokeswoman said: “We do intend to meet up with a number of different organisations to discuss a number of different issues including our repossession policy.”
Earlier this month, in an interview with The Journal, new Rock chief executive Gary Hoffman said the company had a responsible debt management policy.
“It is clearly in the best interests of both the customer and Northern Rock to come to an agreement that results in any customer who has fallen into arrears continuing to make repayments and for them to remain in their home. That is our objective and repossession remains the last resort,” he said.
