Does that mean that if there is 60 million people in Britain and the average family is 2 adults and 2 kids estate car and dog that the average debt on funny money is 15000 pounds per family.That's appalling...........

rwn, muston,

The headline is very misleading. If you do not pay your debts, the bank takes you to court and when they get a ruling in their favour, they can apply for the charge on the property. They cannot force you to sell your house, but when it is sold, they are entitled to receive the money owed from the proceeds of the sale. Just being late in your payments of unsecured debt does not mean that your house is at risk. This is a gross exaggeration. Yet another negative headline to play with people's fears.

Peter, London,

I was under the impression that credit card debts were unsecured and that my house is not at risk from them.

It would seem that by not paying your credit card your house is also at risk. This will come as shock to many households who use credit cards as a way of getting past tight periods!!

Paul Dengy, Slough,

Whilst I have little sympathy for people who have got themselves into such a position, it is the banks who have loaned the money on an unsecured basis - and have charged interest accordingly.

It's a bit late for the banks now to realise that they have been wreckless in their lending practices - whether with personal loans or with exessively high credit card limits. Over the past few years I have experienced more pushy sales practices by visiting the bank than in vitually any other sales environment. This is typical of an industry that was falling over itself trying to get their customers into more and more debt, producing even higher profits for themselves

A Geddes, Thurso, Scotland

All amusing comments ranging from; people should read the terms written in the shifting sand that their loans / credit cards were written upon. V/S The banks should perpetrate a larger market crash in an attempt to recoup a few pounds of exaggerated interest here and there.

Young kids working for the banks and investment markets created the conditions for this lending mess and short sighted governments aren't willing to provide the long term guidance required.

Lets not forget the 1930's, the calendar might change but human nature does not. An interesting future awaits.

Steve, Derby, UK

The small print on an advert for a secured loan always says 'your home is at risk if you don't stick to the agreement'. I hope we now see the same on all loans, as it appears that there is no such thing as an unsecured loan any more.

Andrew, london, united kingdom

It is obscene that Banks should use a Charging Order to recover an unsecured loan especially as the rate charged reflects the nature of the loan.
If your neighbour had a similar loan and rented his property he is in a far better position in the event of a default.
The Banks want it all ways and I feel that Government should step in and right this inequality

V Cooper, Yeovil, U.K.

"I have eliminated the cycle of boom & bust" said Gordon Brown....how deluded was/is that man.........oops he's now Prime Minister!

andy murray, reading, uk

Nicely put Dave from Swansea until that is you yourself are in that situation through no fault of your own.

My wife was unlawfully dismissed from her job while on long term sick leave. The DWP decided to stop her incapacity benefit because she had the gumption to go and get a degree at the age of 50, as the government are so keen to encourage people to do, but because she was over 25 her unemployment fund was not paid as it is for under 25 students, so she ran out of incapacity benefit. This triggered full Council Tax payments at a time when we had no money coming in putting us in debt.

Should we now become homeless because of Government age discrimination?

Not everyone who gets into debt is reckless with their money and your comment is gratuitous abuse to people in that situation.

George Brink, Hinckley, Leics,

Walk in to any high street bank and what do you see? Machines to deal with customers "banking" requirements and slick sales staff there to sell you something you don't want or need. Not one of these people care if what they try to sell to you is appropriate, they are commission driven. In that same bank try to find someone in authority with responsibility! There are none, those in authority are faceless beings hiding in head offices.
Thus the human factor has been abandoned by modern banking, it is driven by shareholder value with a short term horizons to benefit the faceless wonders with their share options.
Sorry but in hard times like these "customers" mean little in the scramble to claw back debt. Be assured that during the compilation of recent results there will have been gross overprovision for loan default and the faceless will grab huge bonuses when the economy turns and they can bring back the provisions. Then the cycle will continue.

John, Lincoln,

These comments all ignore the fact that it's only defaulters who get pursued. People who keep to the terms of whatever deal they signed have no trouble. If the banks broke their side of the contract then there would be uproar - why is an individual who breaks his side somehow meritorious? No one HAS to take out a loan. If you can't afford the repayments, don't do it, it's that simple.

James, Limoges, France

The Banks, the Judiciary, the Bailiffs always the winners, no matter what happens in life.

Mike O Connor, Plymouth,

Neither a borrower nor a lender be.

Nick, London, UK

In reply to Steve - a Charging Order secures a Court Judgment. The amount of the Judgment will be the amount owed to the lender on the day the Judgment is made plus legal costs.

Interest on Judgments is limited by law to simple interest at 8% from the date thereof until payment. If a lender follows this route, they will be limited to the Court rate rather than the rate due under the loan agreement.

Jonathan, London, UK

Perhaps the meaning of the word borrow has befuddled some people . Quite simply, it means that you have to give back whatever you borrowed, because what you borrowed does not actually belong to you. Someone has allowed you to use something which belongs to them, for a period of time.

I have never seen people being 'forced' t o borrow money by the moneylenders, banks, credit companies, whatever, whoever, so while banks etc are there to lend money and receive interest for letting people use 'their/their investors' money, it is still a matter of personal choice and responsibility. whether anyone actually borrows it.

Perhaps more use of the word 'no', by both sides, borrowers and lenders should have been in order, and should come back into fashion for good?

Marita, Mulhouse,

And about time too. Why on earth the banks ever changed their policy of 'conservative' lending as when I grew up is completely beyond me. I can only suppose their greed was actively encouraged by that great (un)natural disaster Gordon McSporran and he of his ilk.

Victor M., Ex pat.,

Charging Orders are yet another example of bank greed and Government inaction. Borrowers are charged a higher rate of interest on an unsecured loan because of the supposed risk to the banks. When the borrower defaults for whatever reason, but often becasue of the very high rates of interest, the banks ask for a charging order converting the loan to a secured one but at a much higher rate of interest which will be reclaimed on a forced sale of the property. . This is dishonest and the Government should prevent the banks from behaving in such a way. Neeedless to say the Courts could also adopt a more robust attitude towards banks for once too!!

Manson, London,

Hang on a minute, don't the high rates of interest applied to unsecured loans reflect the additional inherent risks the banks have taken on?
Presumably, when the charging orders are granted the judges will reduce the balances outstanding to reflect the less punitive interest rates that would have applied had the loans been secured from the outset!
As for Mike's comment that "its depositors money", this is a quaint notion but where has he been for the last 7 months? If this was the case, does he think the credit crisis would have arisen?
The banks have brought it on themselves.

Steve, Pimlico, London,

People who get into debt SHOULD be forced to sell their homes / assets to repay the debt. They can then downsize or rent.

Too many people think they can borrow money without consequences if they fail to repay it. If people lose their homes, it is their problem, not the lenders.

Dave, Swansea, South Wales

How the world can change in six months or so. Then, I don't think many of us would have believed that we would be reading articles such as these. It just goes to remind us all that what goes up must come down, and the further it goes up, the frurther it has to drop. We have all - this includes lenders - allowed ourselves to race out and indulge in a potentially catastrophic financial binge. If its not too late, change your spending habits fast I'd say. If it is too late, I'm sorry for you because we face double trouble. It's not just Joe public in a mess but the lenders too. Put that together and its back to the jungle. The only consolation is that you most definately won't be alone. Maybe there will be strength in numbers. Numbers are votes and politicians need votes. Then again, first time home buyers are out of the market and need house prices to crash in order to have any hope of buying. They are voters too. Not much room for manouvre in Britain today eh?.

Jack Smith, Leeds,

All across the UK once loyal customers to their banks are now seeing the real side of "Bank Managers":

They have no control, all risk is determined by head office computer software, they are unable to input a particular set of circumstances regarding customers that reflect personal changes.

It is all risk controlled with no human consideration.

On that basis the model is doomed longer term. If one person cannot speak to another without "Risk Assesment Software" being used...... then the outcome is obvious.

Banks will now do anything to cver what they thin is exposure. If you have any cash at all, buy a thick mattress and stuff it under there for the next few years.

Matt. Glasgow.

Matt, Glasgow , Scotland

One thing we all have to realise is the fact that;

1/ The individuals that run banks have got us into this mess by their profligacy in lending.

2/ The ordinary man will bail them out of this mess. By higher taxation, higher bank charges, we will all feel the pain.
The banks will not loose on this one and that is the reason there is so much animus from the general populace.

D Stafford, London, England

Out with the credit sharks and ...in with the Banks - why bother with mortgage lending when you can coin it on credit (only those who are going to run-up a lot of interest need apply).

mike, Rennes, France

See "The Money Masters" film on Google, on the internet. One section deals specifically with the techniques used by the World Banking Cartel to accumulate all the property (real wealth) they can during Depressions such as these, which they create deliberately. It's obvious that in the past, certain of your politicians were paid off to introduce this CRIMINAL practice of "a free contract can be so modified arbitrarily by one party". Getting laws like this into the system, are part of the carefully laid plans the Bankers make, sometimes many years in advance, before they begin their "dark harvest" of poverty and mayhem. See the film and you will see the entire banking system of the world, based on institutionalized criminal practices, revealed. When enough of us have seen this film, we will be able to destroy the Banking Cartel and create an honest system that works for us rather than enslaves mankind to debt.

victor compton, Cherbourg, France

Good question by Yoss. Surely once a formerly unsecured loan has been converted by Court Order into a loan secured by mortgage on a borrower's house the rate of interest should be lowered to that applicable to such a loan ?

The bank may think that the borrower has become more risky. But he is not in default; and if the bank wants extra security - and the law of the land, (quite unjustly I think) decides that a free contract can be so modified arbitrarily by one party, then the interest must be equally modified by the Court. If, for example the loan now constitutes a third mortgage, then the Court should find out what is the rate applicable and apply it.

Robert Sebag-Montefiore, Geneva, Switzerland

Mike, and others like you. When you're out of work through no fault of your own, tried for years to get work for 12 hours a day and dealt with that rejection, when you've sold everything you own to maintain your families dignity and home, when you cant sleep at night, when you can't eat for worry, think about anything else, buy shoes for your feet or bread for the table - do you really think that the interest rate and possible consequences of a rise in that rate are going to come between you and using a credit card to buy food in the hope that around the corner, a solution to your problem might present itself?

Try walking a mile in those shoes and then come back and tell us to do something different.

Paul Scofield, Milton Keynes,

Loans of any kind are governed by some kind of contract, the terms of which are in any but lawless countries, explicit and binding on both sides. It is an agreement.

How then can loans the borrower was led to be believe were unsecured be later turned into loans secured on his house?

This is retrospective unilateral renegotiation. Lenders already charge a premium for unsecured loans over secured loans. Now they're getting the unsecured premium for what are in effect secured loans.

Bob, London, UK

Don't remember "your home is at risk if you do not keep up repayments on your unsecured loan" being on any of the personal loan brochures.
Oh well -rip off Britain. Guess it's part of the fsa's 'treating customers fairly' campaign.

peter, reading, berks

What a pathetic article. Banks 'simply' writing off loans??
Good grief, who's money do they think that is? Its depositors money and the Bank SHOULD persue them for their money, just like the local authorities do when you don't pay your council tax. People that borrow money should think about higher interest rates etc when they take out the loan. What would they have done a few years back when interest rates on mortgages were around 10% for a long time?

Its been far too easy for bankruptsy and its time that was stopped as well. The same people start all over again after 1 year.

Mike, Chester, UK

Yoss, Pensacola, Florida

No Yoss. When people sign up for loans and credit cards they rarely read the agreement before they sign it. They are just thinking of the money. If you don't understand or accept the conditions of the loan, don't take it. Too many borrowers are starting to try to pass personal responsibiltiy for the mess they find themselves in. Both the banks who have overextended credit and the borrowers are going to struggle to get sympathy from me. The cause of this mess is greed from both sides.

Edward, London,

Does this mean people with early loan re-payment charges and 15% Credit card rates can refuse to pay them?

As when the loan ws taken out it was assumed to be un-secured, if in fact it was secured then why are people paying over the odds for that line of credit?

Yoss, Pensacola, Florida