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Repossessed homes hit an eightyear high

Repossessions in 2007 were the highest since 1999 although the figures were 10 per cent lower than expected, says the Council of Mortgage Lenders.

A total of 27,100 homes were repossessed compared with 22,400 in 2006.

The CML had forecast that there would be 30,000 repossessions in 2007.

Fewer than one in 400 mortgages led to repossession last year. The number of homes repossessed in the second half of the year was almost identical to the first six months at 13,500 compared with 13,600.

The CML says less than 0.5 per cent of mortgages had accumulated arrears of more than six months at the end of 2007 and the profile of arrears has returned to almost the same levels as the first half of 2006.

The rate of arrears over six months is around one-seventh of the level experienced in the early 1990s.

The CML says it remains difficult to forecast the level of arrears and repossessions in 2008.

Director general Michael Coogan says: “The number of repossessions is likely to be higher in 2008 as a result of wider issues in the economy and the mortgage funding markets. No one is necessarily to blame for this. Even the best risk assessment cannot provide a crystal ball insight to the future for each borrower.”

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