Repossessions fall to a three-year low
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Your support makes all the difference.The number of householders who had their homes repossessed fell to a three-year low in 2010, figures showed today.
Around 36,300 properties were taken back by lenders in the year, 24% fewer than 2009 and the lowest level since 2007, the Council of Mortgage Lenders (CML) said.
The number of repossessions fell during the fourth quarter, with 7,900 people losing their homes, down 11% from 8,900 in the third quarter. This was the fifth consecutive quarterly decline in repossessions, which have steadily dropped since their peak in 2009.
The number of people losing their home has been lower than expected during the economic downturn due to a combination of low interest rates, increased lender forbearance and a raft of Government schemes to help struggling borrowers.
Despite the decline in figures, the CML expects repossessions to rise again in 2011 as the Government's deficit-busting spending cuts gather pace and interest rates start to increase.
The CML said it expects 40,000 repossessions in 2011, as changes to a number of initiatives to help struggling homeowners are also brought in.
The previous government introduced the Mortgage Rescue Scheme, under which people can sell some or all of their home to a social landlord and rent it back, but the price that will be paid for properties is set to be reduced.
Following today's figures, CML director general Michael Coogan said: "Lenders are continuing to work hard to help their borrowers who face temporary financial difficulties."
He added: "As the numbers clearly demonstrate, repossession is a last resort. Most people's payment difficulties can be managed and controlled for a period until their circumstances improve.
"As we go through 2011, the number of people facing payment pressures may increase if interest rates rise, and as a result of the spending cuts that have resulted in reductions in the level of public support available."
There was also an improvement in the number of people who have ended the year with mortgage arrears of more than 2.5% of the outstanding sum of their loan - which at 169,600 was a 13% drop on the previous year end.
David Birne, insolvency partner at HW Fisher & Company chartered accountants, said the figures were encouraging but sounded a cautionary note for the months ahead.
He said: "A big saviour for many households has been the low interest rate environment. Rates have been at record lows for an inconceivably long time, but at some point this will end."
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