"Large increases" in missed mortgage payments predicted
"Large increases" in missed mortgage payments predicted
Wednesday 22nd October 2008
Al Elliot, of Homeowners Advice Centre, said negative equity is becoming a serious problem as house prices fall and tighter lending criteria from UK banks makes it difficult for homeowners to remortgage.
"In the next few months, I suspect a lot of lenders will see large increases of instances of arrears as repayments jump to standard variable rate and homeowners struggle," Mr Elliot said.
Debt problems could mount among people forced to accept higher repayment terms on their mortgages after being unable to sell their homes because they are in negative equity, he added.
The average house price in the UK has fallen by 12.4 per cent to £161,797 over the last 12 months, according to Nationwide.
Meanwhile, Credit Action's statistics show that 104 homes are repossessed in the UK each day.
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