Home repossessions start to slow

The mortgage industry has reduced its original high prediction of repossessions as the amount of people that are facing arrears or foreclosure has continued to diminish.

Between the months of April and June about 9,400 properties were taken back by lenders, which is a decrease from 9,800 during the quarter before according to statistics from the CML (Council of Mortgage Lenders).

Also on the decline is the number of people behind in their mortgages with about 2.5% of all loans in arrears, which was an overall drop from March by about 5%.

The CML had previously stated that this year there would be about 53,000 repossessions but now the figure has been reduced down to 39,000.  It also changed its forecast in terms of mortgages in arrears predicting that only 175,000 mortgages, or 2.5%, would be in arrears compared to 205,000.

However, despite this promising news the industry body still cautioned that it was not yet time to lift the ‘safety net’ because interest rates and unemployment may still start to rise again which will change the picture once again in the mortgage market.

Due to the fact that there has been a spike in the amount of people employed and lower interest rates homeowners were somewhat protected from the fallout of the economic crisis.

However, as the government prepares to pull away its support for mortgage payments and the future of any additional debt advice is still unknown there are still many reasons to execute caution for borrowers.

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