Homeowners struggling with mortgage repayments and worried about the possibility of repossession have been given a new boost with continuing signs tha…
Homeowners struggling with mortgage repayments and worried about the possibility of repossession have been given a new boost with continuing signs that the Bank of England has no plans to raise interest rates soon.
Yesterday (January 12th), the Bank's Monetary Policy Committee (MPC) announced it was holding the base rate at 0.5 per cent again, a decision which, if it is repeated in the next meeting, will mean the record low cost of borrowing remaining in situ for three years.
At the same time, the MPC announced it is not adding to its quantitative easing scheme, with the buying of another £75 billion of assets still in process.
How each MPC member voted will not become clear until the minutes are published, which will take place on January 25th, but as long as the base rate stays where it is, many homeowners will be able to stay in their homes.
Even so, the latest figures from Credit Action – which are mainly derived from Bank of England data – have revealed that 101 homes are repossessed every day.
This suggests those who are struggling with their repayments may find that relying on low interest rates remaining in place is not enough and other measures might be necessary, such as taking out an individual voluntary arrangement.
These can help stave off repossession as well as bringing general debt repayment levels under more control, as they involve reducing monthly payments in a deal that will be binding on all creditors, provided 75 per cent of them agree to the new terms.
By James Francis