41 Percent jump in repossession since start of year

A worrying new report has shown that since January of this year there has been a 41% jump in the level of repossessions, as higher living costs and bills continue to take their toll on household finances, resulting in many people being unable to keep up with repayments on their mortgage loans. Another problem has been the fact that many people are coming off cheap fixed rate mortgages and other special mortgage deals, and due to the ongoing mortgage drought have been unable to find an alternative affordable mortgage to switch to.

The Council of Mortgage Lenders has released figures that show there were 18,900 repossessions in the first half of the year where lenders seized properties because the homeowner was unable to keep up with mortgage repayments. This reflects a rise of 41% compared to the previous six months and 48% compared to the first twelve months of last year. The CML expects repossession levels to continue rising, and predicts that numbers could hit 45,000 by the end of this year.

An official from the CML said: ‘The number of people facing difficulty needs to be kept in perspective. The good news is that most people are coping well and continuing to pay their mortgages in full, despite the higher costs of food and fuel and the higher mortgage rates now prevailing in the market for those coming off cheaper original deals. But it is inevitable that more borrowers’ coping strategies will come under pressure in current conditions than in the unusually benign years of the last decade. That’s why lenders, government and the advice sector are working closely together to minimise the impact on borrowers.’