View more on these topics

Repossessions up 30 per cent from last June says CML

The number of repossessions in the first half of this year rose to 14,000 a 30 per cent increase compared to the same period in 2006, according to statistics from the Council of Mortgage Lenders.

This is 18 per cent higher than the December figure and around 1 in every 840 mortgages ended up being repossessed in the year to June.

The number of mortgages in arrears at the end of June rose to 125,100, up 4 per cent from the December figure but down 3 per cent compared to June last year, the Council of Mortgage Lenders announced today.

Of these, the majority, 71,800, were in arrears of 3-6 months, while 38,300 were in arrears of 6-12 months, and 15,000 of more than 12 months.

The CML suggests the sharp rise in possessions compared to arrears over the past two years is likely to be a result of an increasing amount of sub-prime lending within the overall market.

It also believes increasingly active arrears management by all lenders has stopped many households falling further into arrears unless their financial?situation makes this unavoidable.

CML director general Michael Coogan says interest rates are clearly higher than many were expecting, and are set to remain so, and the greater risks inherent in sub-prime lending are resulting in significantly higher levels of repossession in that part of the market compared to mainstream experience.

He says: “Overall, the vast majority of mortgage borrowers will continue to cope even in a market where affordability is stretched.”

The CML has substantially revised its previously published data back to the beginning of 2003 and in the light of the data revisions it has withdrawn its forecasts for arrears and possessions issued at the start of the year.

Coogan says: “This impact has been underestimated in our past market data, which we have now revised. While the revisions are naturally unwelcome, more accurate market information is important. We will work to further improve data on both mainstream and specialist sectors.”

IMLA executive director Peter Williams says: “There is some deterioration in the figures but they are still exceedingly low by historic standards. If we compare the number of mortgages 12 months or more in arrears with the same period of 1993, we find it is almost 11 times lower.

“Arrears have been fairly steady for the past few years and this tick-up takes arrears up to 2002 levels and possessions up to H2 1999 levels – a world away from the problems of the early 1990s. While any increase is unwelcome by both lenders and borrowers we do need to keep this in perspective.”

Recommended

Pearl Jam

A week has passed since the proposed merger of Resolution and Friends Provident was announced and still there seems to be more questions than answers over the future of both asset management arms.

HIPs criticised for not detailing flood risk

Home Information Packs have come under fire for failing to require sellers to admit if their home is a flood risk.Conservatives have said that the scheme was “utterly untrustworthy and misleading” because new figures showed that one in ten new houses had been built on flood plains.A parliamentary written answer reveals that 10 per cent […]

King and Platt quit Torquil Clark

Torquil Clark Life Insurance directors Jason King and Simon Platt have resigned from their positions effective today to pursue other business interests.King and Platt founded the company, which was formerly Life Policies Direct, in 1999. The Torquil Clark Group bought it out in 2004.King says: “We have been pleased to continue directing the business through […]

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm

    Email: customerservices@moneymarketing.com