Lenders making debts worse

Homeowners with mortgage arrears are having their debt made worse by lenders who levy ‘high and excessive charges, MPs have warned. Borrowers in arrears could be charged as much as £35 for a letter or a phone call, or £150 for a visit from a debt counsellor, the Treasury Select Committee report found. It called on the Financial Services Authority to take a much more robust stance in tackling the charges and urged the regulator and Office of Fair Trading to review them to ensure they were fair. The committee said lenders should also be required to provide an itemised breakdown of the additional costs their arrears charges were supposed to cover.