MCOB 13
The Financial Conduct Authority's Mortgages and Home Finance: Conduct of Business Sourcebook Chapter 13 on arrears handling. Requires regulated lenders to treat borrowers fairly when in difficulty, consider forbearance options, and avoid repossession unless necessary. Breach is enforceable by the FCA and grounds for a Financial Ombudsman complaint.
MCOB 13 imposes detailed obligations on lenders: develop and implement a written policy for arrears handling (MCOB 13.3); make and keep records of the steps taken; consider specific forbearance options (payment holiday, interest-only switch, capitalisation, term extension); not initiate possession proceedings as a first response; give borrowers information about free debt advice. Specific to regulated mortgage contracts. The FCA can fine for breaches; affected borrowers can claim through the FOS with compensation up to £430,000.
Related terms
Related guides
Defending Mortgage Repossession: Your Rights at Court
A mortgage repossession claim is frightening but not the end of the road. Lenders must follow the FCA's MCOB rules and the Pre-Action Protocol for Mortgage Possession Claims before they can issue. The court has wide discretion under section 36 of the Administration of Justice Act 1970 to suspend or postpone possession. This guide walks through every defence and the practical steps to keep your home.
11 min
Mortgage Arrears and the Pre-Action Protocol
Falling behind on mortgage payments is frightening, but lenders are required to follow strict procedures before they can repossess your home. The Pre-Action Protocol for Possession Claims based on Mortgage or Home Purchase Plan Arrears means that courts will expect both you and your lender to take reasonable steps to resolve arrears before a possession order is made. Acting early and engaging with your lender greatly improves your chances of keeping your home.
8 min