Repossessions hit those failing to keep up with Mortgage payments

26/02/2008

According to latest mortgage figures there has been a concerning increase in the number of people who are actually having difficulties keeping up with the monthly mortgage repayments.  The study highlights the extent of this news in East Lancashire where 1600 homeowners lost their homes last year.  Figures suggest a 38 per cent increase since those stated in 2005.

Finance Experts have said for many years that this sort of news has been waiting to happen as people have been able to take out huge mortgages from lenders and manage to live beyond their means.  The finger seems to be pointing at the industry for allowing this to happen.  With sub prime mortgage lenders accounting for majority of the home repossessions lender have had no choice but to review their product ranges on reduce the LTV ratios.

The compounding effect is made much worse in particular regional areas where property prices have been over inflated and first time buyers are stretching to get on the property ladder.  The reality is they cannot afford the move in the first place and their average income has not moved much in the last few years.

A spokesman for Nationwide, commented, "People with weak credit records who secured generous mortgage terms a couple of years ago may find it difficult to remortgage on the same basis. “Banks have tightened their lending criteria since the credit crunch and it is quite possible that borrowers will be asked for deposits as a condition of remortgaging."