FLA forecast is for fewer than 1,000 repossessions
According to the latest figures from the Finance & Leasing Association second-charge mortgage providers repossessed 212 properties in the third quarter of 2010. This continues the trend of the first half of the year, in which there were fewer repossessions than in the same period in 2009.
The low number is a reflection of the longer-term approach lenders are taking to helping borrowers in financial difficulties. Repossession is the last resort after lenders have exhausted all other reasonable debt management options, including Government schemes, where appropriate.
But the FLA has warned that the second-charge market is contracting and uncertainty over the Government’s plans for changes to mortgage regulation via the Mortgage Market Review could hinder the market recovery.
Fiona Hoyle, head of consumer finance at the FLA, said: “The falling number of properties being repossessed shows that lenders are doing all they can to help customers with debt problems stay in their homes, especially at a time of economic uncertainty and job losses.
“The FSA is also consulting on their oversight of the mortgage market. We’d urge them to make sure that they recognise the distinction between first and second-charge mortgages and to review these markets separately. A one-size fits all approach could be detrimental.”