New law on repossession

Homeowners faced with repossession will be given greater protection under the Home Owner and Debtor Protection (Scotland) Bill was today approved unanimously by MSPs in the Parliament.

Housing and Communities Minister Alex Neil said:

“One of the most significant consequences of the economic recession is that too many Scots find themselves caught in a debt trap, putting family homes – and families – at risk.

“Our response, embodied in this Bill, has been to act quickly to introduce more protection for home owners and to offer support to those people who currently cannot access debt solutions.

“Finally, they are protected with the full weight of the law. In implementing the provisions in the Bill, we will continue in the spirit of co-operation that has been a feature of discussions among all political parties in the chamber.

“We will also ensure lenders, the courts, advice sector and others are geared up for implementation of the Bill.”

The main proposals in the Home Owner and Debtor Protection Bill include:

• Improving protection for Scottish home owners faced with repossession at each stage of the repossession process, in particular by ensuring that all repossession cases are heard in court (except where there is evidence that the property has been voluntarily abandoned) Requiring all lenders to demonstrate in court that they have taken reasonable steps to avoid repossession
• Allowing lay representation from approved organisations to make it easier for homeowners to present a defence in court Extending the debt relief offered by bankruptcy to some who cannot presently meet bankruptcy criteria by introducing a certificated route into bankruptcy Extending the protection currently offered for the family home in bankruptcy and to trust deeds

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