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Saturday, May 16, 2009

U.K.: Home repossessions up

by Calculated Risk on 5/16/2009 09:06:00 AM

From The Times: Home repossessions jump as downturn continues to put pressure on borrowers

Home repossessions jumped by more than 50 per cent between January and March as the recession continued to take a heavy toll of borrowers.
About 12,800 homeowners lost their properties because they could not keep up with repayments in the first three months of the year, up from 8,500 in the same period last year, [Council of Mortgage Lenders (CML)] figures show.
[I]ncreasing numbers of homeowners are struggling with the burden of their mortgage. About 265,000 borrowers had missed three or more monthly payments between January and March, up from 135,800 in the first quarter of last year, the CML said.
“We fear a second, more devastating tidal wave of repossessions is coming as unemployment continues to rise, the recession continues and at some point interest rates begin to climb again.” [Shelter, the housing charity, said]
The UK is working through a rule change that required lenders "to prove that they have examined all alternatives to keep borrowers in their homes before seeking a court order" - and that has probably skewed the data. But just like in the U.S., it appears there is a second wave of foreclosures coming.