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Repossessions On The Rise.
Repossession orders are up by 17% in the first quarter to 2008 compared to the same period last year.
There were 27,530 orders made between January and March 2008, up from 23,438 in the same period of 2007.
A repossession order is when the lender takes a homeowner to court to either arrange arrears repayments or get a date by which they can take possession of a property against which a mortgage is secured.
A clear factor for this increase is the cost of borrowing, despite a base rate reduction of .75% in recent month.
I have a mortgage with one the major lenders, base rate + 0.34% for 2 years. This was recently replaced by a product with base rate +1.09%. In other words, my lender is not passing on the current base rate reductions to new customers.
The number of actual repossessions, across the UK and by private lenders only, is shown in figures from the Council of Mortgage Lenders (CML) published twice a year.
The data for the first half of 2008 will be published in August. The CML predicts that there will be 45,000 repossessions in 2008, up from 27,100 in the previous year.
The CML says there are 11.8 million outstanding mortgages in the UK.
But Caroline Davey, from housing charity Shelter, told BBC News that banks and building societies were not doing enough to keep repossession figures down after pulling 100% mortgages from the market.
“I think the lenders have to take a real share of the responsibility here,” she said.
“Those lenders have now retracted all of those mortgages. But what they haven’t done is put their hands in their pockets to help the many thousands of people who are struggling, having taken on mortgages that they simply can’t afford.”
The number of people missing mortgage repayments is also partly due to the rise in household bills owing to the increasing price of food and fuel. The availability of credit has also been cut.
