Foreclosures under review in Britain

The Financial Services Authority, Britain’s financial watchdog, has given lenders until Jan. 31, to review their policies on mortgage foreclosures.

In a letter, the FSA asked lenders to critically review their foreclosure policies, The Guardian reported Friday.

The regulators’ guidelines include using foreclosure as a last resort after attempts to negotiate a repayment plan has failed, the newspaper said.

The Council of Mortgage Lenders said 168,000 homeowners were three months or more behind on their mortgage payments. More than 30,000 homeowners had been forced from their homes this year, CML said.

Conditions in the mortgage market are difficult and it seems likely that these conditions will persist for sometime, FSA retail manager Jon Pain said in the letter sent to lenders.

In such a challenging operating environment it is particularly important for senior management to ensure the fair treatment of customers, including when they go into arrears, the letter said.