Citizens Advice report into sub-prime lending

Commenting on the report from the Citizens Advice Bureau into sub-prime lending, Louise Cuming, head of mortgages at price comparison site moneysupermarket.com, said: "In the current environment it was only a matter of time before fingers of blame started being pointed. With millions of homeowners – many of them deemed 'sub-prime' – set to come off their low rate two-year fixed-rated deals in the New Year, it is clear this Christmas will be a nervous time for many.

"All ‘first charge’ lenders have a legal obligation to treat their customers fairly and sympathetically, especially when they may be in financial difficulties. Earlier this year, we raised concerns this may be not be happening. We identified a number of lenders who charged for arrears advice, which in some cases was as much as £100 – and hardly sympathetic.

"Of course, it is impossible to generalise about a whole industry and say all sub-prime lenders are to blame for borrowers getting into difficulty. There have been many wider factors at work this year, but we do ask lenders whether they could do better by their customers. This will be absolutely vital next year when we may well head into stormier waters."