The government was under fire last night for reneging on its promise to help people threatened with losing their home as Northern Rock admitted it would be responsible for one in 10 repossessions this year.
At a hearing of the Treasury select committee, the new chief executive of Northern Rock, Gary Hoffman, admitted Northern Rock had taken possession of 4,201 homes by the end of September, up from 3,710 at the end of June.
But Hoffman, hired from Barclays on a £700,000 salary, rejected criticism that the bank was undermining government attempts to ease the strain on mortgage payers. A third of all the homes Northern Rock was repossessing were 'voluntary', he said, referring to when homeowners hand back their keys to the lender without any attempt at renegotiation.
Hoffman said Northern Rock was working on an industry-wide solution for mortgage 'forbearance' to help customers at risk of losing their homes through new mortgage rescue packages.
Financial Times, The Guardian