Secured loan and mortgage lenders are to share information as part of plans being discussed between the Council of Mortgage Lenders and the Finance and Leasing Association.
Currently, first and secured loan lenders have little or no contact when they are taking repossession action.
This has in the past led to both lenders issuing repossession proceedings against the same borrower.
The CML is currently in talks with the FLA about what data would be shared and how it could be practically implemented.
Simon Stern, director of Prestige Finance, has been calling for the initiative for some time. He welcomes the discussions and would like to see it extended so mortgage lenders not only share information about repossessions, but also about borrowers who are having payment difficulties.
He says: “The scheme is long overdue and secured lenders have been calling for this for several months. All lenders have their own forbearance polices and we can’t talk to them about borrowers at the moment.”
He hopes the initiative can be put into practice by mortgage lenders as it will help consumers.
A spokeswoman for the FLA says: “The idea behind the initiative is that if a mortgage lender is going for repossession it will contact the second charge lender. This will avoid them both going for repossession and doubling up on costs.”
Latest figures from the CML show repossessions fell by 5% in Q3. Some 8,900 properties, representing 0.08% of mortgages, were taken into possession in Q3. The total was 5% lower than the 9,400 cases taken into possession in Q2.
Meanwhile, latest figures from the FLA show repossessions for secured loan lenders almost halved in Q3 2010 compared with Q3 2009.
Secured loan lenders repossessed 212 properties in Q3 2010 compared with 411 in Q3 2009.