U.K. First Quarter Repossessions Jump 51% on Year
U.K. repossessions by mortgage lenders jumped by 51 percent in the first quarter from a year earlier as the recession deepened, the Council of Mortgage Lenders said.
Repossessions climbed to 12,800, compared with 8,500 in the same quarter in 2008, the group, which represents home-loan providers, said in an e-mailed statement today. The reading is up from 10,400 in the previous three months.
The Bank of England said this week that the economy may contract for the rest of the year and lending will take longer to resume than previously forecast. The bank left the key interest rate at 0.5 percent last week as unemployment jumped in the first quarter by the most since 1981.
“Lenders are demonstrably increasing the forbearance they are offering, while many struggling borrowers have gained some breathing space through lower interest rates feeding through to lower monthly payments,” Michael Coogan, director general of the CML, said in the statement.
The increase in repossessions is still less than the CML expected and the group may revise its forecast for a total of 75,000 this year, the statement said easy to get unsecured personal loans.
‘Relapses’ Forecast
“Home repossessions and individual bankruptcies still seem likely to rise significantly further,” Howard Archer, an economist at IHS Global Insight, said in a research note. “We suspect that the economy is highly likely to suffer relapses and doubt that sustainable recovery will not develop until 2010.”
A separate Ministry of Justice report today showed court orders for repossession in England and Wales fell an annual 42 percent in the first quarter to 22,609. The figure is down 13 percent from the previous three months.
The decline follows the introduction on Nov. 19 of new procedures for filing claims related to property arrears describing what parties must do before claims are issued, the statement said. Not all court orders result in repossessions, and mortgages may be taken back in the absence of a court order.
Filed under: economics by Guru