Fewer Repossessions On Secured Loans
We reported last week on how the number of properties repossessed due to arrears and defaults on the main mortgage or home owner loan had fallen in the last three months of last year and, although there were more people lost their homes than the previous year, the total number was below the amount predicted.
A new survey conducted by the Finance and Leasing Association (FLA)has revealed that the total number of properties repossessed through arrears and defaults on secured loans, or second charge loans, has actually fallen year on year by almost 10 per cent.
There were 233 properties repossessed during the last three months of last year through arrears on a secured loan, rather than the main mortgage, which showed a reduction of 37 per cent on the same period in the previous year.
Over the course of the whole of 2009, there were 1,458 secured loan repossessions, which was lower than the FLA’s prediction of 1,522 and 9.2 per cent lower than the figure for the previous year.
Although these figures show an improvement in repossessions on secured loans and second charge lending, the FLA has warned that due to a fragile economy and rising unemployment in the UK, this figure could easily increase once again over the course of the coming year.
Fiona Hoyle of the FLA said “Second charge lenders are doing all they can to help customers in financial difficulties and this is reflected in the low number of repossessions. But many people are still struggling with repayments and this looks set to continue during 2010. Repossessions will remain a last resort.”
“The small number of properties repossessed shows that the current regulation is working well, lenders are able to lend responsibly and keep repossessions low. We still remain to be convinced that government proposals for transferring regulatory responsibility from the Office of Fair Trading to the Financial Services Authority are needed.”
