It has been revealed that action being taken by the Ministry of Justice could result in a greater degree of protection for homeowners that could otherwise be at risk of losing their homes because of their inability to make repayments on personal debts such as credit cards.

A consultation has been launched by the Ministry of Justice with a view to increasing the minimum amounts owed before the sale of a home can be ordered by the courts to force repayment of the debt by the homeowner.

The system that is currently in place means that a charging order can be placed against the property of a homeowner in the event that they are defaulting on repayments on their credit or store cards, and ultimately this can force them to sell the home and repay the money that they owe. The courts can make a decision to force the sale of the property and make the consumer repay the debt even though the debt was not originally secured against the home.

The Ministry of Justice has stated that sales of properties are only forced in a small proportion of cases, and it was therefore rare for people that could not pay their store or credit cards to be forced to sell the home over it. However, it does happen in a small number of cases and the new measures would help to provide greater protection for those that could find themselves in this situation.

An MoJ official said: “important that the government consider whether there is a risk that the numbers will increase due to the current economic situation, and whether this could result in more people losing their homes because of relatively low levels of debt which they are unable to pay.”

Increased protection could be put into place for homeowners in debt is a post from: Glitec Loans