The number of people who face losing their home has increased in England and Wales according to a Ministry of Justice report.
Its figures show that the number of mortgage possession orders – when courts grant an order for possession of a home – has risen in the first three months of 2008.
27,530 mortgage possession orders were made in the first quarter of the year, up 17% on the same period of 2007.
The report also shows that the number of mortgage possession claims – the first stage of the repossession process – has risen by 16 per cent in the first quarter of 2008. There were 38,688 homeowners facing court action after failing to keep up with their mortgage payments, against 33,344 in the same period of 2007.
Rising household expenditure and reduced availability of competitive mortgages is cited as one possible reason for the increase.
As a result, the Council of Mortgage Lenders has suggested repossession figures are running in line with its expectations and likely to jump to 45,000 for 2008 when they publish their figures in August, up from 27,100 last year.
Howard Archer, chief UK and European economist at Global Insight, says: “Unfortunately the situation seems set to deteriorate significantly further. The financial pressure on many home owners is increasing, and it seems certain that repossessions will trend up appreciably over the coming months, particularly if the economy suffers an extended marked slowdown and unemployment starts rising, which seems likely.”
Chiltern’s Nathan Gladwell says: “Increasingly household budgets are being squeezed from every angle, and it’s no surprise that many are reaching breaking point.
“These figures show that more needs to be done to ensure people don’t lose their homes, and relevant support and advice should be readily available so people can maintain mortgage payments.
“People can help themselves by making sure they control and reduce their household expenditure, and often a structured repayment plan can help with this.
“A Chiltern informal arrangement ensures mortgages and utilities are given priority, and that there’s sufficient money available to repay other debts whilst maintaining a reasonable standard of living.”