Supporting customers experiencing economic abuse

A guide for mortgage providers

If you work for a mortgage provider, there is a lot that you can do to support a customer who may be experiencing economic abuse.

This information may help you to understand economic abuse, know how to recognise it in the context of domestic abuse, and know what you can do to support victim-survivors.

Economic abuse and mortgages

One way in which abusers control their partner or ex-partner is through joint financial products, such as a mortgage.

If the victim-survivor already has a joint mortgage with the abuser, the abuser might:

• fraudulently apply to re-mortgage the property, including releasing equity, or force the victim-survivor to agree to apply for a re-mortgage under duress
• stop paying their share of the mortgage
• withhold consent to re-negotiate the mortgage interest rate, causing payments to rise
• withhold consent for a sale, re-mortgage or equity release
• deliberately cause severe damage to the property, putting it in negative equity
• leave the UK or abscond, leaving the victim-survivor to deal with debts and repayments
• refuse to move out of the home
• use duress to force the victim-survivor to ‘agree’ to the family home being used as security for another loan, such as a business loan
• rent out a buy-to-let property with all the paperwork in their sole name as the landlord, meaning the victim-survivor is not able to make any decisions or take any action in relation to the renting of the property.

Abusers can use mortgages as a tactic even if they do not have a joint mortgage with the victim-survivor. For example, they might:

• fraudulently apply for a mortgage in the victim-survivor’s name
• force the victim-survivor to apply for a mortgage under duress
• fraudulently apply to be added to the victim-survivor’s mortgage or property deeds.
• use spousal rights to register their name on the property deeds.

Other tactics that an abuser may use to indirectly affect a partner or ex-partner’s mortgage include:

• insisting an estate agent/surveyor values the property too highly to make a sale unlikely if it goes on the market
• sabotaging viewings to put off prospective buyers
• deliberately causing damage to the property to sabotage a sale and make the home undesirable
• manipulating professionals such as estate agents so that rental incomes go to them
• refusing to remove their name from the property register.

A joint financial product like a mortgage often means economic abuse can continue long after a relationship has ended.

The impact of economic abuse via a mortgage

Debt

People who experience economic abuse via a mortgage are often left with significant debt, including mortgage arrears.

Often, people who experience this type of economic abuse are forced to take out loans and credit cards, or borrow from family or friends, to maintain payments, prevent arrears and pay legal fees.

Repossession

Repossession proceedings can be issued within three months of the mortgage being in arrears. However, financial proceedings to make the perpetrator pay their share or decide on what to do with the house can take more than two years if the perpetrator is effective in delaying them. The house may have been repossessed by this time.

Affordability

Often, people who have experienced this type of economic abuse will have paid a joint mortgage on their own for many years if the abuser has refused to pay their share. They may finally get the property signed over to them after lengthy court proceedings, only to find that they do not meet the lender’s affordability criteria for a mortgage in their sole name.

Mortgage prisoners

People who jointly own their home with the abuser can find themselves trapped in an unaffordable mortgage if the abuser refuses to re-mortgage or switch. This is a very effective way in which abusers deplete the victim-survivor’s finances and force them into arrears.

Eligibility for legal aid

Homeowners who have experienced economic abuse are unlikely to be eligible for legal aid, regardless of their actual economic situation. This can impact their ability to begin legal proceedings against the abuser, such as making decisions about child contact or obtaining protective court orders. Homeowners often need to go through lengthy court proceedings to divide assets, including the property.

The role of mortgage providers

If a customer that you are supporting is experiencing economic abuse, you might wonder what you should do. Understanding the nature of economic abuse and the impact it can have will help you to identify the support may be available. Noticing the signs and acting on them can have a huge impact on someone’s safety and economic stability.

It might be daunting to talk about economic abuse, but remember that you aren’t there to solve everything. By simply talking to the customer about the issue and what your company can do, you are playing a crucial role to in helping them to achieve economic safety.

Look out for warning signs

There are some key signs to look for, that may help identify that a customer is vulnerable to economic abuse or already a victim.

Look out for customers who:

• remain silent while another party does all the talking
• instruct you to speak to their partner
• seem to be taking instructions from their partner
• appear withdrawn, fearful, distressed or scared
• do not understand or are not aware of a mortgage in their name
• have concerns about protecting their personal privacy or safety
• ‘spoil’ an application form (perhaps for the opportunity for a call from the mortgage provider to say what is happening)
• indicate their mail is no longer being delivered to their home
• ask for something that would clearly not be in their best interest, such as adding a partner to their mortgage or using their property to secure a loan for their partner
• ask for equity to be released from a joint property and try to speak on behalf of both parties
• ask for equity or a loan to be paid into their sole account despite there being a joint account
• tell you that their partner is not paying their share of the mortgage
• want to make changes to the mortgage and cannot get their partner to consent.

Also look out for third parties who present a form carrying the customer’s signature that is otherwise completed in different handwriting.

How to respond

Customers experiencing economic abuse may approach you to let you know what is happening and ask what your company can do to help. It may be very daunting for someone who has experienced economic abuse to talk about what has happened to them. If a customer is experiencing economic abuse, it is important to know how to respond so they know that you are there to support them.

The Financial Services Vulnerability Taskforce and the UK Finance 2021 Financial Abuse Code have set out the ways in which financial service providers should respond to vulnerable customers. This includes customers who have experienced economic abuse.

The guidance advises responding to vulnerable customers in the following ways:

Respond with empathy

You may be the first person that someone who has experienced economic abuse shares their story with. Offer a supportive response that is sensitive to the issues the customer may be experiencing and encourages them to peak to you and seek support.

Many financial service providers offer training on economic abuse for staff, and the training can help you to respond appropriately to customers. Surviving Economic Abuse offers specialist training to companies on economic abuse.

Invite the customer to speak privately about the issue

If you are not already speaking in private with the customer, offer to move the conversation to somewhere quiet where they cannot be overheard.

Be flexible

Many financial service providers have policies on supporting vulnerable customers, including customers facing economic abuse. Find out if yours has a policy like this.

Many policies specify ways in which normal procedures can be altered to better support vulnerable customers. It may be that you can offer a vulnerable customer a longer appointment, for example.

Don’t ask the customer to repeat their story

It can be difficult for people experiencing economic abuse to share their story, let alone share it more than once. With the customer’s consent, note their story securely on their file to minimise the need to repeat it.

Offer specialist help

Refer the customer to specialist services, including external sources of help relevant to their situation (for example, a domestic abuse organisation, specialist debt services or independent legal advice). Specialist services can support them with information to help them make financial decisions.

Consider whether to speak to the customer’s family or friends

The customer may ask you to speak to a friend or relative on their behalf. Consider doing this if it would provide support for the customer. However, it is important to be aware that sometimes family members may also be implicated, especially when intimate partner violence is taking place in the context of honour-based abuse. If the customer has a family member or friend with them, try to make sure that they can speak freely in front of this person. If you have any concerns, speak directly to the customer or suggest that you call back at a time when they are alone.

Consider alerting the police

If you believe that a customer may be in immediate danger of fraud or other criminal activity in relation to their mortgage, ask the customer if they would like you to involve the police. Alerting the police may in some cases put victims of economic abuse at risk of further harm, so always involve the customer if this is something you are considering.

Supporting the customer to regain control of their finances

There are a number of ways that you can support customers facing economic abuse to regain control of their finances.

Only support a customer to take the following actions if it is safe for them and would not lead to further harm from the abuser.

Pursue the perpetrator for debts

The abuser may have forced their partner into mortgage arrears. Your company may have a policy that allows you to write-off debt resulting from domestic abuse, including economic abuse. Or can you pursue the abuser for the re-payment of the debts?

Pursue the perpetrator for mortgage payments

Many perpetrators of economic abuse refuse to pay their share of the mortgage, sometimes doing so to force the account into arrears and prompt repossession. If a customer reports this behaviour to you, is there a way that you can actively pursue the other party for their share of the payments?

Consider allowing a payment holiday

Many financial service providers have policies that allow vulnerable customers, including customers experiencing domestic abuse, a payment holiday that gives them a ‘breathing space’ while things are particularly difficult. Find out if your company has a policy like this and if this is something that you could offer the customer while assets are being divided or while they are reaching safety.

Please be aware that it is common for financial proceedings to take over a year in cases of economic abuse where the proceedings are being deliberately delayed.

Allow decisions in the best interests of both parties

Do your company’s policies allow one party to make decisions without the other’s consent where they would clearly be in the best financial interest of them both, for example, switching to a lower interest rate?

Amend credit scores

Being in mortgage arrears can have a significant impact on someone’s credit score, which can make it difficult for them to become economically stable.

If a customer’s credit score is affected as a result of the abuser’s behaviour, consider amending their records to more accurately reflect their credit worthiness.

Outline all the options

If financial or legal proceedings that will decide the future allocation of the home are ongoing, ensure that the customer knows what their options will be.

Send correspondence to a new address

If a customer has left their home due to the risk of immediate danger, they might prefer to use the address of a refuge or safe house with a PO Box, or they might prefer to have letters sent to a bank branch to collect.

Keep the customer’s details secure

If the customer has moved to a new address because they have experienced domestic abuse but still have a joint mortgage with the abuser, it will be very important to keep their new address details secure. Ensure that the abuser does not have access to the customer’s new address through profiles being linked. Consider what details are on documents they may be requested for court proceedings.

Other things you can do

Review your bank’s policy on supporting vulnerable customers

There may be other ways in which your employer has committed to supporting vulnerable customers.

Speak to the vulnerable customer team

Your bank may also have a team dedicated to supporting customers in financial difficulty. Speak to them to find out more about how you can support customers who have experienced economic abuse.

Review policies

Work with a domestic abuse specialist to review policies and mortgage agreements to try to close-down opportunities for abuse. Does your company have robust policies in place to deal with fraud and coercion appropriately and safely?

Request training on economic abuse

Speak to your organisation about whether training on economic abuse could be provided. Surviving Economic Abuse offers specialist training and consultancy to financial service providers on economic abuse. Please get in touch on [email protected] if you would like to find out more, or work with us to review your company’s policies.

The Consumer Duty

Current responses to economic abuse predominantly focus on addressing negative outcomes for victim-survivors after things have already gone wrong. However, these outcomes could be prevented from happening and the impact on survivors minimised if an understanding of economic abuse was reflected within end-to-end product and service design. 

We have developed a briefing paper in partnership with the law firm Simmons & Simmons to help financial services firms consider economic abuse when interpreting what good outcomes (Principle 12) look like for victim-survivors. 

Examples from the briefing on how firms can help victim-survivors of economic abuse: 

• Consider the application process on joint mortgages and how identification documentation is obtained. 
• Consider what options are available when perpetrators refuse to sign for better rates which can force victim-survivors to pay more for their mortgage.  
• Consider introducing 50:50 liability from the outset on joint products such as mortgages. 
• Ensure that there are specialist teams in place who can provide support to victim survivors and help them gain financial independence from the perpetrator.   
• Ensure staff have received the relevant training to identify economic abuse and respond adequately to disclosure – again eliminating any further harm.  
• Ensuring that the financial business isn’t gaining financially as a result of economic abuse – for example, considering putting a freeze on interest or writing it off and removing fees and charges. 

For further guidance on the Consumer Duty, download ‘How the Consumer Duty can transform responses to economic abuse’.

Last updated January 2020

Further support

We have information that you may find helpful to understand more about economic abuse.

If you are working with someone who is experiencing economic abuse, they are not alone. We have information that can support them to take steps towards safety and begin to regain control of their finances. 

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