Over two in five of those having difficulty paying their mortgage do not seek advice in dealing with their problems, according to Adam Phillips, chairman of the Financial Services Consumer Panel (FSCP).
In a speech to the Council of Mortgage Lenders (CML) in London today, Phillips revealed research indicating seven out of eight of those in difficulty thought their problems were serious.
He called on all mortgage lenders to encourage consumers in difficulty to get advice early before the problem becomes a disaster for both parties.
Of those who did seek advice, 65% went to their mortgage lender, while one in four went to Citizens' Advice Bureau (CAB).
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.
The most significant driver for those not seeking help is negative perceptions of the advice sector, which leads them to conclude that seeking advice is either unnecessary or inappropriate.
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."
He adds: "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. Debt advice agencies must not be seen as a last resort when all else has failed."
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