Brokers fear repossessions could continue to rise and warn borrowers stuck on standard variable rates are most at risk.
The FSA published its lending data this week which shows the number of repossessions rose by 5.8 per cent from 9,134 to 9,760 in the year to September 30.
Last month, the Council of Mortgage Lenders said it might lower its repossession forecast of 40,000 for 2011 after year-on-year figures in November showed a fall of 4 per cent to 27,500. The CML statistics show only regulated mortgages, where the FSA data includes regulated and unregulated loans.
Your Mortgage Decisions director Dominik Lipnicki says: “If the economy gets worse, people living in areas with falling house prices and where the majority of people are employed in the public sector are more likely to be repossessed. People stuck on standard variable rates are massively at risk, especially as we have seen some lenders increase their SVRs recently.”
Lentune Mortgage Consultancy director Stuart Gregory says: “If the economy gets worse and lenders start to react by raising their rates, more people will be in trouble.
“People need to be on top of their situation and take it on themselves to see if they should change mortgages. If people do not do that, they could be in for a bit of a shock, especially those on standard variable rates.”
