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| Home repossessions 'rise by 30%' | |
| (20 minutes later) | |
| The number of people having their homes repossessed has surged, the Council of Mortgage Lenders (CML) has said. | |
| An estimated 14,000 properties were repossessed in the first six months of the year, a dramatic 30% increase on the same time last year. | |
| But while the number of people losing their homes rose, the number of mortgages in arrears came in at 125,000 - 3% down on the same period last year. | But while the number of people losing their homes rose, the number of mortgages in arrears came in at 125,000 - 3% down on the same period last year. |
| Official figures also show the number of mortgage debt court cases falling. | Official figures also show the number of mortgage debt court cases falling. |
| The greater risks inherent in sub-prime lending are resulting in significantly higher levels of repossession in that part of the market compared to mainstream experience Michael Coogan, CML class="" href="/1/hi/business/6928842.stm">Number of people going bust in surprise fall | |
| The Ministry of Justice said that 32,922 mortgage possession claims were issued by the courts - the first stage of the repossession process - during the second quarter of 2007. | The Ministry of Justice said that 32,922 mortgage possession claims were issued by the courts - the first stage of the repossession process - during the second quarter of 2007. |
| This is 0.2% lower than during the same period last year. | This is 0.2% lower than during the same period last year. |
| Most mortgage possession claims do not end with a property being repossessed, mainly because the borrower presents the court with a case for not proceeding or the lender comes to an arrangement with the borrower. | Most mortgage possession claims do not end with a property being repossessed, mainly because the borrower presents the court with a case for not proceeding or the lender comes to an arrangement with the borrower. |
| Calculations changed | Calculations changed |
| Meanwhile, the CML said that it had changed the way it calculated repossession, to take greater account of sub-prime mortgage providers. | Meanwhile, the CML said that it had changed the way it calculated repossession, to take greater account of sub-prime mortgage providers. |
| This may have boosted the CML's estimate of the number of repossessions. | This may have boosted the CML's estimate of the number of repossessions. |
| But according to CML director Michael Coogan, higher UK interest rates and the expanding sub-prime mortgage market are key factors in more people losing their homes. | But according to CML director Michael Coogan, higher UK interest rates and the expanding sub-prime mortgage market are key factors in more people losing their homes. |
| "Interest rates are clearly higher than many were expecting, and are set to remain so," Mr Coogan said. | "Interest rates are clearly higher than many were expecting, and are set to remain so," Mr Coogan said. |
| "The greater risks inherent in sub-prime lending are resulting in significantly higher levels of repossession in that part of the market compared to mainstream experience." | "The greater risks inherent in sub-prime lending are resulting in significantly higher levels of repossession in that part of the market compared to mainstream experience." |
| However, Mr Coogan added that repossessions were still relatively low by historical standards.. | However, Mr Coogan added that repossessions were still relatively low by historical standards.. |
| "Overall, the vast majority of mortgage borrowers will continue to cope, even in a market where affordability is stretched," he added. | "Overall, the vast majority of mortgage borrowers will continue to cope, even in a market where affordability is stretched," he added. |
| Sub-prime mortgages are targeted at people with poor credit histories. | Sub-prime mortgages are targeted at people with poor credit histories. |
| In the US, a high number of people defaulting on sub-prime loans has led to falling confidence in the housing market. | In the US, a high number of people defaulting on sub-prime loans has led to falling confidence in the housing market. |
| Insolvency | Insolvency |
| Meanwhile, the UK government's Insolvency Service has said that the number of people going bust actually fell 8% in the second quarter of 2007 when compared to the first three months of the year. | Meanwhile, the UK government's Insolvency Service has said that the number of people going bust actually fell 8% in the second quarter of 2007 when compared to the first three months of the year. |
| Between April and June 26,956 people became insolvent. | Between April and June 26,956 people became insolvent. |
| Experts say the fall maybe due to lenders becoming less keen to accept Individual Voluntary Arrangements (IVAs), a type of insolvency. | Experts say the fall maybe due to lenders becoming less keen to accept Individual Voluntary Arrangements (IVAs), a type of insolvency. |
| In total, the number of IVAs fell 15% between the first and second quarters. | In total, the number of IVAs fell 15% between the first and second quarters. |
| Have you recently been repossessed or are under threat from being so? Do you have a question to put to a financial expert on the issue? An expert will answer them on BBC News 24 at 3.30pm this afternoon. Send us your questions and experiences by filling in the form below. | Have you recently been repossessed or are under threat from being so? Do you have a question to put to a financial expert on the issue? An expert will answer them on BBC News 24 at 3.30pm this afternoon. Send us your questions and experiences by filling in the form below. |