Loan Arrears And Repossessions Lower Than Predicted
The Council of Mortgage Lenders (CML) has just released its figures for the total number of homeowners who have either had their home repossessed or had a high level of arrears on their loan, for the last three months of last year.
Between October and the end of the year, there were 10,200 properties which were repossessed by the lender due to arrears and defaults on the home owner loan and although this may sound like a high number, it is 13 per cent lower than the previous three months and 2 per cent lower than the same period twelve months ago.
The figures are based on both residential home owner loans and also buy to let loans, but do not include second charge mortgages, or secured loans.
Over the course of the whole year, there were 46,000 repossessions, 2,000 fewer than the CML’s most recent prediction and significantly less than their prediction at the beginning of 2009, when they estimated that there would be around 75,000 repossessions through bad loan management.
Despite the figures being lower than originally predicted, the number of loan repossessions has still seen an increase of 15 per cent above the number for 2008, when 40,000 individuals lost their homes.
It was a similar position when it came to loan arrears, with 188,300 home owner loans having arrears of at least 2.5 per cent of the outstanding loan balance, which was a reduction on the previous three months, but an increase on 2008 figures.
Michael Coogan of the CML said “The fact that mortgage arrears and repossessions did not rise as much as we feared in 2009 is testament to the effect of low interest rates and a great deal of concerted effort by lenders, government and the advice sector to help borrowers to address financial difficulties when they occur.”
