40,000 repossessions in 2008
By politics.co.uk staff
Last year saw 40,000 repossessions – representing one in every 290 mortgages.
Data released today by the Council of Mortgage Lenders (CML) show 10,400 properties were taken into possession by lenders in the fourth quarter of 2008, down slightly from 11,100 in the previous quarter but up 50 per cent from 6,900 in the fourth quarter of 2007.
The body claimed the fall in repossessions in the final quarter shows – despite the worsening economy – mortgage lenders “are making strenuous efforts to ensure that repossession really is a last resort”.
It added where struggling homeowners were working with lenders, in the vast majority of cases repossession is avoided.
Liberal Democrat leader Nick Clegg accused Gordon Brown of wasteful complacency following the release of the figures.
“Tens of thousands of families are going through the pain and misery of losing their homes while the government dithers,” he said.
“Just over a year ago I asked Gordon Brown whether he accepted the prediction that house repossessions would skyrocket by 50 per cent. He ignored the warnings but repossessions have risen exactly as predicted.”
The Conservatives drew attention to the “aggressive” repossession policies of government-owned banks.
“I fear we have only seen the tip of the recession iceberg,” said shadow housing minister Grant Shapps.
“To add insult to injury Gordon Brown is hampering, not helping, hard-pressed families across the country as nationalised banks such as Northern Rock pursue very aggressive repossession policies.”
CML director general Michael Coogan warned there was a “sharp rise” in cases of people not contacting their borrower and just handing back house keys
“We strongly urge borrowers to contact their lender and work with them before taking this step, as there may be other solutions,” he said.
“Borrowers are still liable for their debt, even if they leave the property, so working through their problems is much more likely to be in their best interests.
“We know the plethora of schemes and initiatives is daunting, and we are working closely with government and advice agencies to try to simplify the information available, and ensure that those borrowers who may qualify for help get access to the information and advice that they need at the right time.”
One in 64 mortgages is now in arrears of 2.5 per cent or more.
In 2008, 105,900 homeowners were between 2.5 per cent and five per cent in arrears – a 46 per cent increase on 2007.
Some 24,300 were over ten per cent in arrears.
The percentage of all mortgages in arrears is the highest since 2000.
By the end of last year, a total of 182,600 mortgages – or 1.57 per cent of all home loans – had accumulated arrears equivalent to 2.5 per cent or more of the outstanding balance – compared to 1.08 per cent at the end of 2007.
