Northern Rock has undergone a Damascene conversion over its treatment of mortgage customers in arrears, a debt charity has said.

The lender, which has been roundly criticised for keeping its mortgage rates punishingly high and repossessing a disproportionately large number of homes, is overhauling the way it approaches bad debts.

'We are seeing big changes at the Rock,' said Malcolm Hurlston, chairman of the Consumer Credit Counselling Service. 'Before, they took a tough approach with borrowers in arrears but now there is a road to Damascus scenario – they are being more sympathetic.'

In a summit last week with leading debt and housing charities, including the CCCS, Credit Action, Shelter and the Money Advice Trust, Northern Rock set out its plans for stepping up help to those facing repossession.

Independent on Sunday