The Number Of Possession Orders Granted Doubles
The number of people losing their homes after failing to meet their mortgage repayments has doubled almost, the UK’s financial watchdog has said.
The number of possession orders aproved by courts in the third quarter of 2008 was 13,161, up a massive 92% from a year earlier.
The Financial Services Authority also said the number of people struggling to clear home loan arrears has also risen.
Earlier this week, figures showed mortgage lending fell by 30% in 2008 its lowest level since 2002.
A possession order is when a lender is given legal control of a property by a court – though does not automatically lead to them taking the property and selling it on or evicting those living there.
The FSA said the number of homeowners who were about three months behind with their mortgage repayments had jumped to 340,000, a rise of 24% from a year earlier and 10% higher than in the previous quarter.
This was a “significant” jump from the previous quater, it added.
The FSA said that about 2.9% of all mortgage holders were now behind with their repayments – with those in arrears managing to pay an average of 42% of their normal mortgage payment each month.
Late last year, mortgage lenders predicted the downturn would lead to about 75,000 repossessions – close to levels seen during the last recession of 1991.
The Council of Mortgage Lenders (CML) also said that the number of households more than three months behind with their repayments would reach 500,000.
That would be more than double 2008’s figure, estimated at 210,000.
The government has announced a string of initiatives to try and keep people in their homes, amid rising unemployment and economic slowdown.
These include a scheme that sees not-for-profit housing associations buying homes from vulnerable people struggling to pay their mortgage and then allow them to continue living there.
Meanwhile, homeowners who lose their jobs are to receive financial help, with the interest payments on their mortgage being cut from 39 weeks to 13 weeks.
Another initiative, the Homeowner Mortgage Support Scheme, will allow households that see their income fall unexpectedly to defer part of their payments for up to two years.
And lenders are to be legally compelled to use repossession only as a last resort, having looked at other alternatives with the borrower, such as reducing monthly payments.
However housing charity Shelter said that the rescue schemes would “help just a small fraction of those in trouble”.
“While the government yet again bails out some of Britain’s floundering banks with billions of pounds, it is still seemingly unable to provide adequate support for millions of hard-working homeowners,” said chief executive Adam Sampson.
“These new figures are not just numbers, they are heartbreaking tales of real people losing their homes.”
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