Repossessions temporarily on the decline

As a result of the economic downturn, many homeowners have turned to specialist repossession solicitors as they fear that they will lose their homes to mortgage lenders. Since 2010 repossessions have been on the rise, but new data shows that the numbers have recently begun to stagnate.

 

According to the Ministry of Justice, the number of repossession actions embarked on by lenders has fallen by nearly 10% in the second quarter of the year, compared to the first. This trend has also been recorded in research carried out by the Council of Mortgage Lenders, whose numbers show that for the first time in two years the number of homes being repossessed is decreasing.

Losing one's home can have devastating consequences on affected people's lives; this has led to many bodies are pushing the Government to assist those struggling financially so that repossession proceedings are a last resort.

 

Many homeowners have been able to avoid repossession proceedings by resorting to the Government's Support for Mortgage Interest Scheme (SMI), under which unemployed individuals can get assistance with their mortgage interest payments.

 

The scheme kicks in after a waiting period, which until 2009 was set to 39 weeks. However, with the economic crisis and increased unemployment, the waiting period was lowered to 13 weeks. Industry specialists have said that this lower waiting period, combined with better conditions for borrowers, are amongst the principal reasons as to why repossessions have decreased.

 

The Government is considering bringing the waiting period back up to 39 weeks, which has been discouraged by many specialists as such an increase is likely to see a rise in court actions as more people would be at risk of losing their homes.