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CML – record repossessions prediction pessimistic

CML – record repossessions prediction pessimistic

Category: Mortgages

Updated: 15/05/2009
First Published: 15/05/2009

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The Council of Mortgage Lenders (CML) has said that predictions of near record repossessions in 2009 were overly pessimistic despite a 50 per cent year-on-year increase.

As such, the body is to revise its predictions in the next month.

Figures released by the CML shows 12,800 homes were repossessed between January and March this year; in the same period last year 8,500 repossessions were made while 10,400 took place in the final quarter of 2008.

At the current rate, 140 homes a day are being repossessed in the UK.

The number of home loans with arrears of more than 2.5 per cent of the mortgage balance has also increased from 182,600 in the fourth quarter of 2008 to 205,300 in the first quarter of 2009 – a 12 per cent increase.

CML director general, Michael Coogan, said lenders genuinely want to help borrowers in cases where there is a commitment to solving the problem.

The chief economist of the Royal Institution of Chartered Surveyors (RICS), Simon Rubinsohn, said Government schemes, the Home Owner Mortgage Support and Mortgage Rescue Scheme, would soon begin to have a positive effect against the backdrop of falling claims and orders.

"RICS estimates that the (yearly) figure could be as low as 50,000, which would be some way below the highs seen in the early 1990s," he predicted

However, Liberal Democrat Shadow Housing Minister, Sarah Teather, said the figures made for grim reading and that the Government should be ashamed that the Mortgage Rescue Scheme had helped just one family since it was unveiled.

"Despite the Government's attempts to grab headlines with their initiatives, the number of families being repossessed is still rising," she added.

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