BSA calls for more government help for those facing repossession
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The UK Housing Review 2009/10 published by the Chartered Institute of Housing and the Building Societies Association today calls for more government initiatives to protect home owners at risk of repossession.
It says useful temporary measures have included reducing the nine month delay before unemployed home-owners can get help with their mortgage interest payments under the Support for Mortgage Interest scheme, deferring the reductions in the SMI standard rate of interest and extended forbearance policies provided by lenders.
The number of repossessions will be lower in 2009 than the peak of 76,000 in 1991 – but the outlook for 2010 is still uncertain.
Analysis of repossessions by CIH’s consultancy arm - ConsultCIH - published in October 2009 identified some clear financial similarities and patterns of household behaviour.
ConsultCIH predicts that if interest rates begin to rise steadily in 2010, people who have taken out a mortgage in the past four years, and those who have re-mortgaged in the past five, are more likely to be at risk of repossession.
At the same time, research published by the Building Societies Association has shown that the sooner a borrower contacts their lender or obtains free independent money advice the greater the chances of them staying in their home.
The research found that 97% of borrowers who fell into arrears during the last two years have remained in their homes, demonstrating the effectiveness of the approaches taken by the vast majority of lenders.
Paul Broadhead, head of mortgage policy at the BSA, says: “Falling into mortgage arrears is always a worrying experience for the individuals involved and every repossession represents a great personal tragedy.
“We have long suspected, and research now proves that if a borrower contacts their lender as soon as they realise that they may face difficulties, the overwhelming majority manage to repay their arrears and stay in their homes.”
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Readers' comments (1)
Don Smith | 18 Dec 2009 10:39 am
Morre government help - what more can the government do ??
If you lose your job you can claim up to £200,000 of your mortgage.
You can claim Tax Credits and Council Tax Benefit.
The government has pressured lenders to show greater and greater forebearance.
The article is correct if homeowners come forward they are 97% sure they will keep their home.
The only thing I can think the government can do is to advertise a little more to encourage homeowners to call their lenders and seek advice.
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