HML predicts 33,000 repossessions in 2013
The financial outsourcer predicted that Northern Ireland would have the highest repossession rate at 1.29% during the year while the South West came in lowest at 0.18%.
Damian Riley, director of business intelligence at HML, said although the forecast was largely “neutral” he was concerned over customers’ ability to pay their mortgages.
He said: “Firstly interest rates will inevitably rise and secondly there is also the ticking time bomb of borrowers with poor credit history who hold interest-only mortgages and have to repay the principal amount at the end of the mortgage term. Unless innovative solutions are found repossession may be the only way for the lender to recover on the loan.”
Riley added: “With inflation at 2.7% and likely to stay above the Bank of England’s own 2% target for some time to come, workers continue to face reducing spending power that will put the squeeze on those mortgage borrowers who are close to the limit of their ability to make monthly repayments.”
Analysis by HML was undertaken on data containing over one million mortgage accounts and it says its survey is the only one of its kind in the UK to break down repossessions by region.