Charity predicts 'second wave' of repossessions

24 June 2009



There is likely to be another increase in the number of mortgage arrears and repossessions, housing charity Shelter has announced. Rising unemployment is likely to be the main trigger for this increase, it said, which will begin to surface when interest rates escalate again and mortgage support schemes finish.

"The government and lenders are working hard to help homeowners who are struggling now. But they must not be complacent, and we fear they are not planning adequately for the future," suggested Shelter Chief Executive Sam Younger. Some hope had been offered to struggling homeowners earlier this week when the Council of Mortgage Lenders reduced its repossession forecast from 75,000 to 65,000.

Shelter said the sudden rise in repossessions is likely to occur within the next two years, especially with the unemployment rate currently at its worst for 12 years. A sudden hike in mortgage payments or change in circumstances could cause problems for any borrower, it added.

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