The UK nationalized Bank Northern Rock is more likely to repossess its customers homes more than any other UK bank says a charity aimed at helping beleaguered home owners. The charity Credit Action said Northern Rock it is not being flexible enough with customers who default on their mortgage repayments.
Northern Rock was the first bank to really highlight the problems of the economy in the UK were bailed out by the UK government after confidence disappeared in the banks ability. This led to a run on the bank with queues of worries investors withdrawing their funds. It transpired that the bank was lending irresponsibly and had lent to people that could not really afford to repay them. Before running into funding problems last summer, Northern Rock was one of the UK’s biggest and most aggressive mortgage providers.
Director of Credit Action Chris Tapp said: “They are also not giving people a lot of time; they seem to be moving for repossession quite quickly as a resort.”
A recent statement of the Council of Mortgage Lenders said banks and building societies should use repossession only as a last resort.
“Lenders have to work with borrowers to explore all possible repayment options before they move to repossess,” she said.
But Northern Rock chairman Ron Sandler, said: “I refute any suggestion that our position has been anything other than commercial.
“I would deny strenuously that we have been overly aggressive (in terms of repossessions).”
