CML reports further fall in repossessions
The Council of Mortgage Lenders (CML) has today reported a further fall in repossessions – the third consecutive quarter in which they have fallen.
According to the Council, lenders seized 9,400 properties in the April to June period – 400 less than in January to March period.
Experts argued, though, that many homeowners have been saved from repossession, due to historically low interest rates, which drove monthly mortgage repayments down.
As a result, the CML has once again revised its forecast for 2010 repossessions, expecting a total of 39,000 repossessions for the year, compared with its previous estimate of 53,000.
In the meantime, the number of mortgages in arrears also dropped, by 5% during the second quarter.
At the end of June there were 178,200 loans with arrears equivalent to 2.5% or more of their mortgage balance.
This also represented a 17% fall on the same period a year earlier.
The CML’s director general, Michael Coogan, comments: “Mortgage difficulties have so far been contained at lower levels than we expected at the start of the year, and by comparison to the 1990s recession.
“However, the safety net for borrowers is weakened by the prospect of higher interest rates, a possible rise in unemployment, [and] reduced government support for mortgage payments,” added Mr Coogan.
Last month, it emerged that funding for mortgage schemes aimed at helping vulnerable homeowners are to be cut.
The Mortgage Rescue Scheme, which was established early last year to help struggling homeowners in England facing repossession, allowed people to sell their property to a local authority or housing association but stay on as a tenant.
The scheme has helped more than 600 households, while a further 1,849 applications were ongoing by the end of March, according to recent figures.
However, the future of the scheme is now in doubt.
The CML is therefore warning that some borrowers remain in a precarious position, and is urging the Government to continue to support homeowners.