Repossessions 'lowest since 2007' as councils handed new 'safety net' cash

Published by Ross Macmillan for 24dash.com in Housing and also in Central Government, Communities, Local Government

Repossessions have fallen to their lowest annual level since 1997, according to the Council of Mortgage Lenders (CML).

The number of homes taken into possession by mortgage lenders in 2011 was 36,200; slightly down on 2010, when 37,100 homes were repossessed.

CML director general Paul Smee said: "Low interest rates and good arrears management by lenders are helping the vast majority of those borrowers who face difficulties to keep their homes and get back on track."

However, although arrears and repossessions throughout 2011 were fairly stable, the CML says it has no current plans to revise its current 2012 forecasts for the year.

It says "worsening unemployment" and "continuing pressures on the cost of living" seem likely to result in some further deterioration in the position of households in 2012.

The CML anticipates that this is likely to result in around 45,000 repossessions and around 180,000 mortgages in arrears of 2.5% or more by the end of the year.

Meanwhile, the housing minister Grant Shapps said the government would pay for extra support for homeowners facing difficulties.

Local authorities will be given £19m to offer to struggling homeowners interest-free loans of less than £5,000, or grants, to help ease debt pressures.

Another £1m will extend a service available in the county courts, giving free on-the-day legal advice to those facing home repossession hearings.

Mr Shapps said: "Repossession should only ever be the last resort. No one in financial difficulty should be embarrassed to seek help if they need it. Today's cash ensures that no matter where you are in the country the advice and the financial support is on hand to help people get on top of their finances and keep them in their hard earned homes.

"Getting advice early is important but even for people facing a court hearing repossession is not a foregone conclusion. By extending the reach of the Court Desk scheme we are ensuring that no one is left stranded without the support of the free on the day legal advice that has already saved thousands of families from repossession."