Low interest rate limiting repossession numbers

Wed, 14 Dec 2011

The number of homes in the UK being repossessed is being kept down by low interest rates, it has been suggested.

Ben Wilkie, editor at What Mortgage - a magazine aimed at first and second time buyers that was first published in 1982 - noted people who enter financial difficulty tend to prioritise keeping a roof over their head above any other matter, meaning they are at pains to make sure their mortgage or rent payments are kept up.

The industry figure noted repossessions will always take place, but 2011 has seen this number kept relatively low.

He explained lenders tend to be helpful whenever people experience monetary problems, adding: "The vast majority of people who find themselves in trouble will find a way of keeping their home ."

A rise in interest rates, however, is likely to be the catalyst behind any surge in repossession numbers in the future.

Mr Wilkie went on to point out that should interest rates return to five per cent again, individuals will need to pay ten times as much as what they are at the moment.

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