MP warns thousands at risk of home repossession 'without court order'

Hundreds of thousands of families are at "serious risk" of having their homes taken away without a court order unless the law is changed to protect their rights, Labour MP Andrew Dismore said today.

The result of a High Court decision in October last year means "unscrupulous lenders" are able to sell someone's home without court permission if the owner defaults on just one mortgage payment, Mr Dismore said.

The MP for Hendon, who is also chair of Joint Committee on Human Rights, told the Commons the situation was "truly shocking" in 21st century Britain and would only get worse as the recession took hold.

"No-one should lose their home without good reason, without proper and fair justification, and without an impartial court hearing," Mr Dismore said.

"This problem is immediate, and it is urgent."

He pointed to figures from the Financial Services Authority and Council of Mortgage Lenders which suggested up to a million householders were likely to default on at least one mortgage payment in the coming year.

The same two bodies had also reported sub-prime mortgage lenders taking an "increasingly aggressive approach" to repossessions, a trend Mr Dismore said was likely to increase as the economy worsened.

He added: "Hundreds of thousands of people and their families are therefore at serious risk of being thrown out of their homes without first having any opportunity whatsoever to put their point of view to a judge to try to persuade the court that it is neither fair nor reasonable to evict them."

Mr Dismore was introducing a Bill that would overturn the decision in Horsham Properties Group Ltd v P Clark & C Beech in October last year, which ruled that repossession following the default of a mortgage payment does not breach the homeowner's human rights.

The Homes Repossession (Protection) Bill would require mortgage lenders to get court permission before selling the home, and would allow the court to delay a sale to give the homeowner more time to meet their payments if appropriate.

"It doesn't guarantee that people can stay in their homes indefinitely if they cannot pay the mortgage," Mr Dismore said.

"But it does make sure that people have an opportunity to persuade an independent court that it is far too early or disproportionate to throw them to the street - bags, baggage, furniture and kids' toys - at the whim of a hard-bitten property company."

Mr Dismore used the cause to push for a bill of rights to be introduced for the United Kingdom, saying such a document would not have allowed the courts to interpret the law as they had.

He praised steps taken by the Government, such as the Homeowner Mortgage Support Scheme, to help those struggling with mortgage repayments through the downturn.

But he said: "It is truly shocking that in Britain, in 2009, such a basic legal protection for homeowners is not already part of our law...

"Until we have such a bill of rights, there is absolutely nothing to stop our courts from giving the highest priority to the rights of banks over the rights of ordinary people to a fair hearing before losing their home."

Mr Dismore's Bill, which has cross-party support, received an unopposed first reading but is unlikely to become law due to a lack of parliamentary time.