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Last Updated: Tuesday, 21 March 2006, 08:22 GMT
Debt bill branded 'heavy-handed'
Picture: Richard Hanson
Shelter believes the new measures could put homeowners at risk
New bankruptcy laws have been attacked as heavy-handed by a leading homeless charity in Scotland.

Shelter has claimed people who owe as little as 1,500 could end up losing their homes to pay off their debt.

It intends to ask the MSPs scrutinising the bill to soften any regulations, while Citizens Advice Scotland wants homes to be made totally exempt.

However, ministers defended the proposals, which they said offer "robust" protection for debtors.

The aim of the Bankruptcy and Diligence Bill is to strike a fairer balance between the rights of the debtor and those owed money.

However, under land attachment proposals, if a debtor cannot or will not pay, a creditor will be able to apply for rights to "heritable property".

There are alternatives that are not as heavy-handed as threatening people with homelessness
Ian Brown
Citizens Advice Scotland

According to Shelter, if the total exceeds 1,500, a creditor will be able to apply to sell the property or attached land to recover the debt.

Archie Stoddart, director of Shelter Scotland, said: "On one hand Scotland's politicians have promised that everyone should have a home by 2012.

"Yet on the other hand these proposals will put many homeowners at risk of losing their home, working directly against efforts to tackle homelessness.

"No-one should lose their home for a debt of 1,500."

Breathing space

Ian Brown, of Citizens Advice Scotland, told BBC Radio's Good Morning Scotland programme that the agency wanted MSPs to drop the proposal from the bill.

He added: "This new proposed power is wholly disproportionate. Nobody should lose their home for a debt of 1,500.

"There are alternatives that are not as heavy-handed as threatening people with homelessness."

However, the executive said a debtor's home could only be sold with the authority of a sheriff.

Under the legislation, at least six months must elapse before the creditor could apply to sell the property, which the executive said would give people breathing space to pay.

A spokeswoman said: "Land attachment is one of a range of tools that it is possible for creditors to use to recover debts owed to them, making it harder for 'won't pays' to avoid paying what they are due.

"However, at the same time, the bill offers robust protections for debtors."


SEE ALSO:
Seeking solutions to homelessness
18 Jan 06 |  Scotland
Minister makes homeless priority
21 Dec 05 |  Scotland
Chisholm sets out homeless target
21 Dec 05 |  Scotland
Homeless children numbers on rise
12 Dec 05 |  Scotland


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