According to the Council of Mortgage Lenders (CML), in the second quarter of 2012 there were 8,500 repossessions, about 1,000 fewer than in the first three months of 2012 and the lowest number since the final quarter of 2010. The drop in the second quarter of the year was in line with a seasonal pattern the CML has seen in each of the preceding three years.
The amount of borrowers falling behind with their mortgage payments was similar in comparison with the same quarter in 2011 and the first quarter of 2012. The CML’s director general, Paul Smee said: “The figures show that lenders, borrowers and debt advisers are working together to get through the current period of economic difficulty and keep mortgage possessions in check” .
Earlier figures from the CML displayed the number of house repossessions in the UK sank to its lowest level in four years. This figure is overshadowed however, by the fact that the group said it expected there to be a higher number of people facing more “serious problems” this year.
They have predicted that repossessions will rise from from 37,000 in 2011 to 45,000 this year, as a result of people’s budgets remaining under pressure during a time of high unemployment and low wage growth.
In an interview with The Guardian, Mark Harris, chief executive of mortgage broker SPF Private Clients said: “That repossessions are likely to rise for the year as a whole is depressingly predictable. Although interest rates are expected to remain at 0.5% for the foreseeable future, a growing number of borrowers are still struggling.”
“Mortgage rates continue to rise, despite the non-movement of base rate, with more than a million homeowners seeing an increase in mortgage rates in May, for example. Those with little or no equity in their homes don’t have the luxury of being able to remortgage on to a cheaper deal.”
It is a sad fact, that many homeowners face repossession not because they refuse to downsize, but because they simply cannot sell their homes. Many are now turning to the avenue of a quick house sale from a registered property buyer, that while giving them less than market value, cuts through red tape,estate agents fees and waiting times and has none of the stringent criteria attached to it that going through a traditional mortgage lender would entail. Ultimately, people are turning this solution as it guarantees a sale and allows the homeowner to plan the next stage of their life, secure in the knowledge that their biggest worry has been taken care of.