View more on these topics

Payplan launches free arrears service

Payplan has launched a specialist arrears management scheme for mortgage lenders.

The new service, completely free to those in debt, will focus specialist support for customers who are struggling to honour their mortgage payments due to unsecured debts.

Around 3 million fixed-rate and discounted mortgage deals end in 2008 and 2009, and borrowers will move into higher mortgage payments. Payplan says that due to the recession and other debt commitments, borrowers are not financially prepared for this rise, leading to increased mortgage arrears.
 
The firm says its clients in mortgage arrears owe on average £42,500 in unsecured debt, and often haven’t told their mortgage lender this.

The new service enables lenders to see the ‘whole picture’ of a customer’s indebtedness, and then works out the best course of action to reduce the chance of arrears reoccurring.
 
Phil Bushell, arrears manager at Payplan, says: “Against this back drop of rising arrears, the benefits of the scheme for lenders are clear: improve your clients’ finances, clear their arrears and enable them to make regular mortgage payments once again.
 
“Without an intermediary service like Payplan’s to manage the entirety of a customer’s debt, traditional solutions such as payment breaks and capitalisation of arrears only serve to delay an inevitable decline into further arrears.”

Recommended

Spowart to plead against Lloyds takeover on C4

Jim Spowart, the founder of Intelligent Finance, and Scottish National Party MSP Alex Neil will call on HBOS shareholders to vote against the planned Lloyds TSB takeover on Channel Four tonight.

Lenders face a dilemma

What a year it’s been. Of course, 12 months ago it was already clear that 2008 would be difficult, to say the least. Wholesale funding markets were paralysed – as they still are – and most of us were expecting a sharp reduction in house price growth. But nobody predicted a near-collapse of the financial system and the nationalisation of several banks. The economy is now much weaker than we expected at the start of 2008 and consumer confidence has collapsed. So, the real issue for 2009 is how to keep nearly 12 million borrowers secure in their homes.

Newsletter

News and expert analysis straight to your inbox

Sign up