Some 137 homes were repossessed in Bath in just nine months last year, according to figures from the Ministry of Justice. But there are hopes that the number of repossessions will fall in this year following new Government guidelines to banks.
Forty homes had mortgage possession claims issued from July-September, a rise of eight per cent on the same period the previous year. This took the figure for mortgage possession claims to 137 in nine months, a rise of 20 per cent on the previous year.
But experts say it is hard to determine the actual figure as the statistics do not take into account people who voluntarily give the keys back to lenders, or who managed to hang on to their homes.

This fact was found at: www.thisisbath.co.uk/news

For every 500,000 people becoming unemployed there will be a further 20,000 repossessions, says a new report from CB Richard Ellis.

‘Loss of income through unemployment is the major contributory factor towards arrears and repossessions,’ says the report.

The Government support for mortgage interest payment kicks in 13 weeks after being made unemployed.

The report highlights the most groups most vulnerable to repossession being the sub-prime market and the buy-to-let borrowers. ‘High mortgage rates are a particular problem for borrowers coming to the end of their current mortgage deal. These homeowners are finding it difficult to obtain a mortgage on comparable terms and may not be able to afford the higher rates,’ it says.

‘There are a large tranche of vulnerable borrowers which could increase the severity of the problem,’ the report concludes.

This report was found at: www.countrylife.co.uk/news/property

It has been revealed in a recent report that a mortgage rescue scheme that aims to try and reduce the number of repossessions taking place is to be rolled out across England. The scheme involves social landlords, which are housing associations, buying up homes from homeowners that are struggling to meet the repayments and could otherwise face repossession, and then allowing the former homeowners to continue living in the property on a rented basis.

The scheme is costing the government around £200 million, and it is estimated that around six thousand repossessions could be halted through the scheme. There are similar initiatives in place or planned in Ireland, Scotland, and Wales, according to industry officials. This latest scheme is one of a number of measures that have been put into place to try and reduce the number of repossessions across the country, with some industry groups predicting that repossession numbers could soar as high as 90,000 over the course of the year.

This latest scheme was put into place last year, with an agreement being drawn up by the agency that represents the housing associations in England, the National Housing Federation, and the Council of Mortgage Lenders. So far the scheme has been adopted by around eighty local authorities across the country, but will now be extended across the rest of England. In Scotland a similar scheme has been in place for around five years, and it is thought that so far around seven hundred homeowners have benefited from the program.

Housing associations in England will buy up qualifying homes based on an independently assessed market value, and the homeowners will then either be allowed to stay on at the property as a rent paying tenant or may qualify to receive a loan from the housing association so that they can stay on as owners. The homeowners can then repay the loan in part or in full as their financial circumstances improve.

The scheme will be mainly aimed at more vulnerable households, such as those with children, those with disabled family members living in the household, and pensioners.

For more about this subject: www.loans4.co.uk

Vince Cable MP led a debate at Westminster on Tuesday 13th January, questioning the government’s response to the increase in home repossessions.

The Association of Mortgage Intermediaries (AMI) had prepared a parliamentary briefing for Mr Cable, the Liberal Democrat treasury spokesman, ahead of the debate, voicing their concerns for both the private and commercial property sectors.

Figures previously released by the Council of Mortgage Lenders (CML) had estimated the number of home repossessions at 75,000 in 2009, which Mr Cable noted was just “the tip of the iceberg”. With further news yesterday of a 302 per cent increase in buy-to-let repossessions, Mr Cable also addressed how the issue would affect landlords and their tenants.

Parliamentary under secretary of state, Iain Wright MP, responded to Mr Cable’s address saying that, with particular reference to buy-to-let, the government hoped to extend the notice which tenants were given when rental properties were repossessed.

Mr Cable was particularly interested in whether the government had accurate numbers for the measures brought in to help those with mortgages, most notably, the Homeowner Mortgage Support Scheme (HMSS) and changes to the Income Support for Mortgage Interest (ISMI) scheme.

He said: “Repossession is a tragedy for families because it usually involves not just the loss of a job but the loss of a home at the same time. It is a double tragedy.

“However, there are some less obvious reasons why repossession is a problem. It is a problem for society, particularly for local government, because of the pressure that it brings to bear on social housing. Over the past few weeks, there has been an upward revision in the number of people on waiting lists from 1.7 million to 2 million, so the pressure is clearly there.”

Mr Cable also spoke of the “vulnerable position” of tenants, who could find themselves homeless with very little warning, if their landlord’s property was repossessed.

He concluded his argument by saying: “If we add 9,000 and 6,000, which are the estimates so far in respect of the two main Government schemes, we are talking about 15,000 people, potentially, out of 75,000 people, which is an important figure but is still less than a quarter of those involved. That leads to the necessary conclusion that, even with these schemes in place, large numbers of people will be repossessed this year. That raises the question of where they will live.

“Repossession is taking place in an environment where the provision of social housing is deteriorating. How far do the Government’s proposals match the severity and scale of the repossession crisis that we now face?”

Mr Wright responded to Mr Cable, explaining that families should not fear repossession. He said: “It is a major trauma that is, arguably, the biggest single difficulty that a person can face in their life. It affects people’s relationships, their health—particularly their mental health—their well-being and quality of life. Children can be uprooted from their school and adults from neighbours, friends and family. In the current challenging economic climate, more people are understandably worrying that they could lose their home.

“I want to reassure the House, and families throughout the country, that we are determined to help as much as possible. No household that experiences a temporary drop in income through no fault of its own, and which is willing to pay back what it can, should fear repossession.”

Mr Wright explained the necessity for the government to be flexible at this time, and also to receive feedback from their constituencies on how the new measures were working.

He added: “We are in the process of establishing a new scheme to help people who are having trouble making payments but are not eligible for ISMI—income support for mortgage interest. We have in mind families in which perhaps one person within a couple has lost their job or income or experienced a dramatic cut in overtime or payments. Applicants must have an outstanding mortgage of less than £400,000 and savings of less than £16,000. We estimate that this will take care of 98 per cent. of all mortgages.”

Prior to the debate at Westminster Hall today, Chris Cummings, director general of the Association of Mortgage Intermediaries, had prepared a briefing for Mr Cable.

Mr Cummings said: “We think it is of crucial importance that Sir James Crosby’s recommendations for temporary guaranteed securitisation are implemented as soon as possible by the government.

“We agree with his comments that ‘unless and until banks get access to attractively priced sources of funding the shortage of mortgage finance will endure’. AAA mortgage backed securities are still relatively safe and could actually be profitable for the government, but the cost of funding these instruments would be attractive to all banks so there would be no stigma in using them.”

This was found at: www.aboutproperty.co.uk