The Council of Mortgage Lenders (CML) is claiming that home repossessions will keep rising during the rest of the year, following a 10% increase in the first quarter of 2012 compared to the same period in 2011.
It predicts a total rise from 37,000 repossessions last year to 54,000 in 2012 which it blames on the continuing financial uncertainty together with higher living costs and squeezed incomes. The CML said that the 10% increase already seen has been as a result of many lenders pushing up their mortgage rates and also tightening their borrowing criteria, leading to a fall in the number of mortgages being approved.
The CML says the government should act to provide at least some temporary benefit to help those struggling to afford their repayments. It says that the Support for Mortgage Interest (SMI) scheme has helped almost 250,000 people who have been having difficulty keeping up with payments. However the government is intending to scale back the scheme next year claiming it is not sustainable.