Mortgages Uncovered

Both the Bradford & Bingley and Northern Rock have been advised to cease charging for their mortgage arrears. The nationalized banks Northern Rock and Bradford & Bingley are now under pressure to stop charging their customers when they miss a payment.

Northern Rock, now completely nationalized are starting to charge its customers who are 3 months in arrears anywhere up to £55 a month and £25 a month for two missed payments and is said to rake in over £1million a month from arrears charges.

Bradford & Bingley who were nationalized last year will charge £25 per month the second a borrower falls month behind in payments.

Debt charities of the mortgage levies are arguing that the banks are putting unnecessary additional pressure on property owners who are already struggling to make payments.

Both lenders told The Times newspaper that current charges were under review. B & B said it was likely to further “improve” the structure of its penalties in order to support the interests of its customers better.

“These charges from lenders owned by the taxpayer have the effect of pouring salt into the wound, compounding the problem for families unable to make their mortgage payments.” Chris Tapp of debt charity CreditAction told The Times. “The logic seems warped.”