Mortgage lenders are sometimes failing to show sensitivity towards customers who have endured a personal crisis such as a bereavement and are struggling to keep up with their payments, the City regulator has found.
The Financial Conduct Authority (FCA) wants lenders to make sure they are treating their most vulnerable borrowers fairly and that front line staff are given enough flexibility to offer leniency when trying to help people to hang on to their home.
The regulator found evidence that circumstances which require particular care, such as bereavement, terminal illness or physical or mental health issues, were not always picked up on by staff or properly examined.
It said such cases "were not consistently identified or appropriately probed by front line staff in some firms, even when they were explicitly referred to by borrowers". "This resulted in firms failing to treat some customers sensitively," said the FCA.
The FCA said it wanted to raise awareness of the problem across the industry after it published its review of mortgage lenders.