More mortgage arrears 'may not mean increased repossessions'

Date:Thursday 22nd October 2009
Author: Max Freedman

Even though more people may fall into arrears with their mortgage in the future, this may not lead to a huge increase in repossessions, according to an industry insider.

Chris Jenkins, co-owner of the Homeowners Advice Centre, pointed out that a short period of unemployment could lead to a person falling into arrears.

However, he noted that once a benefit payment has been arranged that person may be able to continue to afford their repayments.

While more people getting into arrears does not necessarily lead to a spike in repossessions, Mr Jenkins observed that borrowers are still facing problems.

"Despite bold statements made by some that the housing market and general economic outlook are becoming more favourable, there are still many ordinary people and organisations that are struggling," he explained.

The Property Portfolio Rescue Distress Index published this week showed an increase of 25.7 per cent in the number of enquiries from distressed homeowners.