97% of arrears cases do not result in repossession, says BSA
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The research also found that 46 per cent of borrowers who spoke to their lender before getting into financial difficulty have since repaid their arrears, compared to 19 per cent of borrowers who spoke to their lender a few weeks afterwards.
The report says arrears are normally the result of fluctuations in either income or expenses, both a result of the difficult economic climate.
The most common cause of borrowers going into arrears on their mortgage was losing their job, which was the reason behind 43 per cent of arrears cases.
BSA head of mortgage policy Paul Broadhead says: “While falling into mortgage arrears is always a worrying experience for the individuals involved, most borrowers do manage to repay their arrears and stay in their homes.”
The report coincides with the launch of a new information leaflet to help borrowers in arrears handle their difficulties, which has been written by the Money Advice Trust, which also runs National Debtline.
Money Advice Trust chief executive Joanna Elson says: “At National Debtline we assist many people with mortgage arrears, and we know that those who seek early independent advice often have more options.”
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