Repossession still a major problem

Large numbers of UK householders still face a very real threat of repossession, new figures have indicated.

The February digest of statistics from Credit Action has shown the level of mortgage debt owed by each household with such a home loan was £110,703 in December, while of the average household debt of £55,823, only £7,948 was not on the mortgage.

While many are managing to pay off their home loans comfortably, many are not, a situation that may be linked to problems such as a sudden loss of income, with 1,797 people being made redundant each day.

But whether it is due to a sudden financial shock or a gradually deteriorating situation taking its eventual toll, the study found a property is repossessed every 14 minutes and 17 seconds.

Based on third quarter figures, the daily tally is 101 properties lost, while 193 mortgage possession claims are issued each day and 153 mortgage possession orders made.

Those who are behind with their mortgage payments should contact their lender in the first instance and may be able to get help through these means.

But if the situation gets worse, householders may be wise to seek further assistance, like a debt management plan, which will spread out the payments more. Among other benefits, this could lower other debt repayments such as those on credit cards or loans, freeing up extra cash to pay the mortgage.

Last week, the latest Alliance Trust UK Financial Reality Index indicated that the problems facing Britons in terms of financial wellbeing eased a little.

But the reading of 62.1 in the final quarter was still way below the score of 100 required to indicate things are getting better and in such circumstances, many homeowners might find they slide increasingly closer to repossession unless they seek help.

Posted by Paul Thacker