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This is because of an obscure clause in the bank capital directive being worked on by the European parliament.

 As part of a large reform package that seeks to make banks safer and regulation more uniform, the draft directive says that all European Union loans must be treated as if they are in default when they are 90 days in arrears.

While this is already common practice in many of the 27 EU states, it would overrule the current practice in the UK whereby mortgage borrowers are given up to 180 days before they are officially in arrears.

If the new rule comes into effect, it could also change how lenders deal with forebearance, including their reporting procedures.