The Ministry of Justice has announced plans that could prevent you losing your home if you fall behind on credit card or loan payments.

A minimum level of debt would be required before a judge could order the sale of your property to repay an 'unsecured' debt under the proposal, which is up for consultation.

Unlike a secured liability, such as a mortgage, this is a debt where your home is not used as security for the lender if you fail to repay (see the Mortgage Arrears and Redundancy guides).

But the law currently allows a lender to force you, in extreme cases, to sell your home to clear the balance if you're behind on payments, by applying a 'charging order' against the property.

This is a topic has campaigned on. In our '50-word' Consumer Manifesto submitted to the three main political parties we call on a ban on lenders forcing you to sell your home if you're behind on an unsecured debt.

Justice Minister Bridget Prentice says: "We know that only a small proportion of charging orders result in the property being sold.

"But it's important the Government considers whether there is a risk the numbers will increase due to the current economic situation, and whether this could result in more people losing their homes because of relatively low levels of debt."

A consultation, which closes on 30 April, asks whether a minimum level of consumer credit debt should be set in law before an order for sale can be issued.

Further reading/Key links

Prevent repossession: Debt Help, Mortgage Arrears Help
Cut costs : Cheap Mortgage Finding, Balance Transfer Credit Cards