In a report published today, A joined-up approach to helping mortgage borrowers, the trade body sets out a number of recommendations on lender forbearance and government schemes.
The BSA is calling for the government to actively encourage the take-up of mortgage insurance, and to look at whether its support for the mortgage interest scheme could be extended to more consumers.
The trade body also says that while forbearance has worked well to prevent repossessions, the separate regulatory structures for first-charge, second-charge and unsecured lending is confusing for consumers and leads to varying requirements on forbearance.
It argues that these structures should be made consistent in order to provide clarity for both consumers and lenders.
In addition, the report says that further investigation is needed into how homeowners with shared equity schemes could ‘staircase’ the amount of equity in their property up or down depending on their circumstances.
The BSA says that the government has an important role to play in preventing repossessions, but so do other parties such as lenders, insurers and advice agencies.
It says it is launching the report to coincide with the political party conferences and will be debating the issue of repossessions at fringe events at the conferences in conjunction with the Money Advice Trust.
Paul Broadhead, head of mortgage policy at the BSA, says there is no silver bullet to eliminate repossessions, and instead a framework of solutions is needed which can help as many borrowers as possible remain in their homes.
He says: “Consumers get into difficulty meeting their mortgage repayments for a variety of reasons; in many cases it is caused by an unexpected life event, such as job loss or relationship breakdown.
“It is easy when reading statistics on repossessions to lose sight of the fact that each one represents a family who have lost their home. This is why the BSA is urging the industry, the government, and other stakeholders to work together to help those at risk of losing their home.”