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MORTGAGE CRISIS – Report on the UK says Banks Must Restructure Mortgages to stop repossessions
The following Press release and report have been published by ECRC partner Inclusion, main organizers of this year’s international responsible credit conference in London.

The paper “Responding to the Mortgage Crisis - A Review of Recent Policy Announcements” written by Damon Gibbons and attached below is one of a short series of policy reviews provided to support discussions at the ‘Responsible Credit 2008’ conference taking place on 13th and 14th November at New Connaught Rooms, Covent Garden, London. The conference will bring together over 200 delegates from 25 countries to discuss the causes of the current global financial crisis and to discuss responses to it.

Other papers to be released in this series will focus on
• Over-indebtedness and the labour movement
• Implications of the crisis for Corporate Social Responsibility
• Building the Coalition for Responsible Credit

The conference will also discuss a draft declaration (‘the London declaration’) on the global financial crisis, which calls for governments throughout Europe to ensure consumer agencies and the labour movement are engaged in a constructive dialogue with the industry and government over future governance arrangements for the credit market. The full text of the draft London declaration is contained in the appendix to this report.

Further details of the conference, including booking arrangements and press passes can be obtained from or on line at

The Centre for Economic & Social Inclusion is an independent, not for profit organisation working with national and local government, voluntary organisations and business to promote social justice and tackle disadvantage. We provide a wide range of services, including policy development, research and practice consultancy, in the fields of welfare to work, learning and skills, benefits and taxation, debt and poverty, housing and regeneration, equal opportunities, economic development and drugs, crime and criminal justice issues.




Even ‘aggressive’ rate cuts by the Monetary Policy Committee on Thursday will not be enough to stem a rising tide of mortgage repossessions, according to a new report published today by the Centre for Economic & Social Inclusion (‘Inclusion’).

With repossessions at their highest level since the housing market crash of 1991, and more than 30,000 people set to lose their homes on current trends before next April, the report argues for more radical measures to be taken to help hard pushed borrowers reduce mortgage payments and to improve court protection against repossession.
The report highlights the fact that the cost of mortgage repayments, relative to household income, has been steadily increasing since 2004. This has now been combined with a ‘de-coupling’ of mortgage rates from bank base rates as a result of the global financial crisis – causing the cost of borrowing to rise rapidly, a surge in arrears, and a rush to repossession by lenders who have also seen house prices fall dramatically.
Pointing out the more pro-active approaches now being taken by regulators in the U.S where ‘loan modification’ programmes are now being introduced to ensure no-one pays more than 34% of their income on mortgage repayments, Damon Gibbons, Head of Policy and Partnership at Inclusion, commented:
“Restoring mortgage affordability is critical to reducing the number of repossessions. There is a strong case for government to insist that banks introduce a mortgage restructuring scheme in the U.K in order to achieve this. The new UK Financial Investment Company should ensure it uses the £37 billion of taxpayer investment in Britain’s banks as a lever to achieve this.”
Inclusion’s report forms one of a series of being timed to coincide with ‘Responsible Credit 2008’, an international conference taking place in London on 13th and 14th November, which will bring together over 200 delegates from 26 countries to discuss the financial crisis and which will debate the future for regulation of the credit market.

Notes to Editors
1. A copy of the full report is attached to this press release.
2. The conference – “Responsible Credit 2008” takes place at the New Connaught Rooms, Covent Garden on 13/14 November 2008. Full details, including a link to the current programme, are available from the Centre for Economic & Social Inclusion website at
3. For press passes to the conference, please e-mail Kylinda Chilcott at with the subject heading ‘press pass request’
4. Damon Gibbons is available for comment on + 44 (0) 796 186 9473

ID: 42039
Author(s): DG
Publication date: 05/11/08

Link to Conference website (run by Inclusion)

Created: 05/11/08. Last changed: 05/11/08.
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