GEMHL counters claims it is too quick to take borrowers to court
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GE Money Home Lending has defended its behaviour towards home owners facing repossession following a damning report from AdviceUK, Citizens Advice and Shelter last week. The report claims that sub-prime lenders are taking court action earlier than high street lenders.
Of its sample of 2,444 cases 55% were put for ward by sub-prime lenders, 34% by high street lenders and 7% by spe cialist second charge lenders.
Some 15.8% of these cases related to GEMHL, with 12.8% relating to Lloyds Banking Group, 7.4% to Santander, 6.5% to Southern Pacific
Mortgage Limited and 6.3% to Kensington.
The market share of GEMHL, Ken sington, SPML and Preferred com bined is only 2.3% whereas their share of listed court cases is more than 21%.
But a spokesman for GEMHL says more court action by subprime lenders reflects the amount of lending made available to those with impaired credit histories.
He says that GEMHL has been the most active lender involved in government initiatives to help borr owers and has links with in dependent debt charities.
The spokesman says: “As a result of these efforts we have seen a stabilisation of arrears across our portfolio and a 58% fall in repossessions since early 2009. Court action with a small minority of our customers is only an option after all att empts to agree alternative options have been exhausted.”
He says some of the statistics in the report present a distorted market view and in particular misrepresent GEMHL’s for bearance efforts with borrowers.
He adds: “While every case is important the number of court cases cited by the report represents less than 0.1% of our client base.”David Harker, chief executive of Citizens Advice, says: “Our research makes it clear that safeguards to protect people from avoidable homelessness must be strengthened to stem the rising tide of repossessions.”
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