Mortgage arrears and repossessions rise

Date:Wednesday 29th October 2008

Repossessions have increased by 71 per cent as more people fail to keep up repayments on their mortgages.

New data from the Financial Services Authority shows 11,054 homes were repossessed in the second quarter of this year.

The figure from the same period in 2007 was 6,476.

More homeowners are entering arrears on their mortgages, with 312,000 loan accounts going into the state in the three months ending in June.

This is a 16 per cent rise on one year earlier.

House prices have also fallen by eight per cent in the year to September.

According to the Council of Mortgage Lenders (CML), total repossessions this year will increase by 50 per cent to 45,000, the Times reports.

Last week, the CML issued new guidelines for dealing with mortgage holders who were in arrears.

It wants to make repossession a last resort, giving lenders a practical guide to requirements and examples of good practise they can use as models.