Mortgages - Repossessions Rise

By: Gill Critchley

Last year saw a 21% increase in lenders taking back properties after people could not keep up with their payments. The increase was the highest it had been in eight years and experts say that it will only get worse.

According to the Council of Mortgage Lenders, repossessions tripled in 2007 and a total of 27,100 houses were taken back. However, this is not as high as figures reached in 1991 when 75,540 houses were repossessed and the Council of Mortgage Lenders had predicted a 10% increase on the actual figure of repossessions in 2007, nevertheless, there was still a significant rise in lenders taking back houses last year and with experts foreseeing that things will only get worse, there does not look to be a bright future ahead for borrowers.

The reason that things may get worse is as a result of mortgage mortgagestarting to tighten their lending criteria and this is occurring as the economic situation does not appear to be improving.

Although these predictions sound very worrying, it has to be noted that, while repossessions have risen since the recent low in 2003 and 2004 from less than 10,000, they are still very few, equal to only one in 400 mortgagesand the continued increase in properties being taken back in 2007 did not happen, with 13,600 houses being repossessed in the first half of the year and only 13,500 during the second.

However, the experts cannot be ignored, and they are suggesting that figures in 2007 were almost acting as a warning to borrowers, as they are envisaging 2008 to be a lot worse.

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