New research has found that nearly half of consumers do not seek advice when in mortgage difficulty.

In a speech to the Council of Mortgage Lenders, Adam Phillips, chairman of the Financial Services Consumer Panel said his group’s research indicates that two in five of those having difficulty paying their mortgage did not seek advice in dealing with their problems.

And yet, seven out of eight of those in difficulty thought their problems were serious.

Of those who did seek advice, two thirds went to their mortgage lender, while one in four went to Citizens’ Advice. Consumer experience of lenders’ advice was mixed: some felt their mortgage lender was unhelpful and inflexible, whereas others felt their provider did all they could reasonably do to help them.

It appears that the most significant driver for those who do not seek advice is not a lack of awareness of or difficulty in accessing advice services, but rather their perceptions of the advice sector and their own situation.

Phillips says: “When people get into difficulty with their mortgages, they need constructive help and advice on the best way forward. Mortgage lenders have a duty under the principle of Treating Customers Fairly both to help their customers in arrears, and also to tell them about independent sources of advice.

“There is an urgent need for more investment in publicising and supporting sources of information and advice in this area. We need to do much more to encourage consumers in difficulty to get advice early.”

Simply, the single best source of mortgage advice is a mortgage adviser. For absolutely nothing, an adviser will outline a borrower’s options and offer them different ways to solve their financial problems. They may not be able to solve every problem, but they will offer fair, impartial advice – all for free.

SOURCE: FSCS, 06/07/09

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