The pre-action protocol, drafted by the Civil Justice Council’s Housing and Land committee took effect from 19 November 2008.
It states that lenders need to act fairly and reasonably with each other in resolving any matter concerning mortgage or home purchase plan arrears; and encourage more pre-action contact between the lender and the borrower in an effort to seek agreement between the parties.
Richard Hurst, director at The Charlbury Group director says: “The challenge for lenders without a branch network is that where a borrower does not answer phone calls or respond to letters there is little option but to proceed down the repossession route.
“We’re finding that lenders are struggling to find enough people ‘on the ground’ to make contact with borrowers to open a meaningful dialogue or, at the very least, to try and open up a line of communication so that all options can be explored.
“We believe that by adding a personal visit to a lender’s pre-action protocol will improve the number of occasions where possession can be avoided and in cases where this is unavoidable they can demonstrate that this additional, proactive step has been taken. This supports the pre-action protocol and also adheres to the principle of Treating Customers Fairly.”