Repossessions expected to soar due to rising unemployment

The Council of Mortgage Lenders (CML) is due to release repossession figures later today and a sharp rise is expected.

The CML has predicted 65,000 people will have their properties repossessed during the year - a 17-year high. While this is 10,000 less than the estimate it made late last year, it is still considerably higher than the 40,000 homes repossessed in 2008.

Rising unemployment is expected to result in a rise in the number of borrowers falling behind with mortgage payments, which could ultimately lead to them losing their home.

Figures released by the Office for National Statistics earlier this week revealed that the number of unemployed in the UK has risen to its highest level since 1995.

Official figures show that unemployment increased by 220,000 to 2,435,000 in the three months to June, and takes the unemployment rate to 7.8%.

The figures equate to around 2,500 losing their jobs a day.

However, historically low interest rates have meant lower mortgage payments for many and this has eased the burden somewhat. Rates currently stand at 0.5%.

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