A top panel of lawmakers in UK has suggested that the Financial Services Authority (FSA) should take a long hard look at the UK mortgage market and in particular charges made to those in arrears. There is evidence to suggest that letters to confirm a mortgage holder is in arrears are attracting charges up to £35 and an appointment with a debt counsellor is costing some people in the region of £150 per visit. These charges are being added to the debt which these customers are struggling to pay in the first place!

There is some similarity with the UK overdraft charges which are currently going through the courts in order to check their legality and ultimately whether customers should be reimbursed for historic charges. The law on charges states very clearly that they must only reflect the underlying cost to the company involved and must not be extreme or "over the top". It will be interesting to see if anybody actually takes their mortgage lender to court over these charges and how far the case may go.

When you consider how many people are currently in arrears with their mortgages the potential income is enormous for the UK banking sector.

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