Second charge mortgage lender Equifinance says the continuing rise in the number of county court judgments (CCJs) demonstrates that consumers still need help with debt management and provision for access to financial products.
New figures the Registry Trust show that there were 419,510 CCJs recorded against consumers in England and Wales during the first six months of 2016, a year on year increase of 13% and the fourth consecutive year of increases. This represents a rise to the highest level for a decade.
However, Equifinance argues that this does not mean that the customer is a high risk when it comes to secured loans, nor is it necessarily an indication of future problems. By each case being looked at individually by an experienced underwriter, it’s possible to provide access to finance that in the longer term allows the client to get their finances back on track, the lender believes. From a lender’s perspective, the aim is to ensure the customer arrives at the desired outcome with a good payment record and future access to other finance the products they need.
The non-profit Registry Trust collects judgment information from jurisdictions across the British Isles and Ireland. In England and Wales, it operates the Register of Judgments, Orders and Fines on behalf of the Ministry of Justice. A judgment is incontrovertible proof that debt has not been managed.
Tony Marshall, managing director of Equifinance, said: “The Registry Trust figures show that there is still a need for lenders to provide products to help a growing number of people with debt problems. The FCA has already highlighted this requirement for financial access and it’s something we take very seriously at Equifinance. It’s also important that secured loans help customers in these circumstances and are used to meet their longer term financial goals.
“The lender also needs a degree of security but if these underwriting issues can be balanced, specialist lenders are in a good position to help more customers struggling with debt.”