The number of repossessions in 2007 was 10 per cent lower than the Council of Mortgage Lenders’ original forecast.
The association says that at 0.23 per cent, the repossession rate was less than half the rate experienced throughout the first half of the 1990s.
There were 13,500 repossessions in the second half of 2007, which was almost identical to the number in the first half of the year at 13,600.
The CML says that fewer than 1 in 400 mortgages led to repossession in 2007.
The CML had previously forecast that there would be 30,000 repossessions in 2007, but the actual figure is nearly 10 per cent lower than forecast, at 27,100.
Fewer than half a per cent of all mortgages had accumulated arrears of more than six months at the end of 2007, and the profile of arrears has returned to virtually the same levels as in the first half of 2006.
The rate of 6+ month arrears is only around one-seventh of the level experienced in the early 1990s.
The CML has also voiced its concern again over the activities of sale and leaseback companies. Due to the sector not being regulated, it feels that the risk of consumer detriment is high.
The CML, Citizens Advice and Shelter jointly wrote to the Treasury late last year to urge regulation of this emerging activity. This week the organisations wrote jointly again to urge fairer treatment of home-owners within the benefits system: at the moment a home-owner who loses their income is severely disadvantaged compared with a tenant in the same position.
The CML has also written to the Treasury to outline the many steps that lenders take to avoid repossessions.
CML director general Michael Coogan says: “Lenders take their responsibilities to borrowers facing repayment difficulties very seriously, and many go to exceptional lengths to provide debt counselling, reschedule payments, extend loan terms, or in some circumstances even allow payment breaks. They abandon repossession action right up to the last moment if they can reach a payment solution consistent with both the borrower’s and the lender’s interests.
“Despite this, 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 particular borrower. But that is all the more reason to ensure that there is a fair and reasonable balance of responsibility between consumers themselves, their advisers and lenders, and the system of state support to ensure that home-ownership remains sustainable and that repossessions are minimised.”