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Friday, 5 December 2008

Repossession Watch

As the recession bites the number of people struggling with mortgage repayments and facing repossession is expected to surge.

Being repossessed is a massive emotional strain and the financial scars can last for years. Unfortunately in current market conditions more individuals, families and investors are likely to have a run in with the repo man

With house prices continuing to fall many more households will enter negative equity. It is widely expected that number of homes worth less than the mortgage secured on them will top the 1.8 million seen during the last slowdown of late 80/90’s.

As long as these home owners can maintain their mortgage repayments and don’t need to move there is no immediate issue. However if employment/circumstances change and they can’t keep up repayments, the options to sell are very limited and repossession is a real risk.

We have already seen the volume of repossessions increase this year. According to the Council of Mortgage Lenders s in 2003/04 fewer than 9,000 properties a year were repossessed. In the first 9 months of 2008 there have already been over 30,000 repossessions.

So what does the future hold? Well in 2003 only 99,500 households were in arrears on their mortgage. During 2008 the number in arrears has increased to over 168,000! Many of these people will not recover their finances and will be repossessed. And with looming job losses many more are expected to fall into arrears in coming months.

If you find yourself struggling with mortgage repayments firstly speak to your lender to see if more flexible repayment structure can be agreed. If this fails seek advice from an independent financial advisor or a body such as crisis or citizen’s advice.

If you fear your home could be repossessed, contact Quick Move Now or read our home repossession page - we could help you.