People are struggling more then ever to pay their mortgage, with new figures showing the number of homes repossessed has gone up 68 per cent in 2008. City watchdog the Financial Services Authority reported that the number of properties repossessed in 2008 by lenders was 46,750, just under double the amount of homes repossessed in 2007, which was 27,900.
There has also been a sharp climb in the number of people who have fallen behind in mortgage repayments during the final quarter of the year. Around 68,000 people have moved into arrears and 377,000 homeowners are living in arrears, which is a 31 per cent increase.
The FSA commented on the mortgage accounts increasing: “With borrowers increasingly struggling to clear their arrears, the total number of loan accounts in arrears has been steadily increasing since early 2007.”
The FSA also said that many lenders are lending to people who can?t prove they have a stable income, which is a risky proposition.
It?s not all bad news as the FSA figures have shown a slight fall in the number of homes being repossessed during the final quarter, with 436 fewer homes being repossessed than during the previous three months.
Unfortunately, property value went down by a record 11.5 per cent during January, making it the 15th month in a row that the annual rate of house price inflation has fallen.
