View more on these topics

Northern Rock follows RBS with six-month reprieve

Northern Rock has joined RBS in offering those with mortgage arrears a six-month reprieve before initiating repossession action.

The nationalised bank, which has been criticised for its strong repossession strategies over the last few months, says those cases where repossession does occur, it has worked with the customer, on average, for a period of 15 months from when they first fell into arrears.

The Chancellor Alistair Darling previously announced that all UK lenders have to give at least a three-month reprieve before beginning repossession orders.

The six-month package of RBS was criticised this week as a “publicity stunt” after most other lenders revealed that repossession action usually takes at least six months to enact.

Northern Rock chief executive Gary Hoffman says: “We continue to work with customers facing repayment difficulties to try and agree an acceptable debt management solution and avoid repossession.

“In the vast majority of cases, where repossession regrettably does take place, we have been working with the customer for well over six months. We will now formalise our policy and agree not to repossess a property for a period of at least six months from the point of arrears.”

Recommended

Feverish regulation in a cold climate

With the FSA’s plans to make some firms hold three months of expenditure as capital adequacy and using an educated guess, may I suggest that the following groups will be unhappy.

Pharmers’ market

Stockmarkets’ powerful and volatile movements have continued to catch many investors by surprise as equities have struggled to reflect fears over the financial crisis and a severe economic slowdown.

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment