Home repossession levels may be worse than the 90s

Fri, 04 Nov 2011

The level of home repossessions in the UK is likely to hit heights greater than those recorded during the economic downturn of the 1990s, it has been suggested.

Eric Stoclet, chief executive of Crown, noted the current financial climate means rising debts are unlikely to show signs of slowing any time soon, Mortgage Strategy reports.

The expert was speaking at the Council of Mortgage Lenders' Mortgage Industry Conference and Exhibition in London and stated: "Over the cycle, arrears and repossessions will outpace those seen in the 1990s."

He added a spike and a drop could be witnessed - as it was back then - or "as is more likely, we could see a long, drawn out slog of relatively high arrears".

Indeed, repossession and debt levels could escalate as a consequence of rising interest rates .

Mr Stoclet added that although the forbearance methods adopted by lenders are helping keep a lid on such movement at present, the effect of these are likely to run out at some stage in the not-so-distant future.

His comments follow director of Shelter Scotland Graeme Brown's remarks that the threat of home repossession is becoming increasingly common in the UK.

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