Mortgages

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By Sky News team

The number of people who have lost their homes has soared by more than 50% in the first three months of the year.

A total of 12,800 properties were repossessed, up from 8,500 a year earlier and 10,400 during the previous quarter, according to the Council of Mortgage Lenders (CML).

But despite the steep jump, the council said its forecast of 75,000 repossessions during 2009 now looked pessimistic and it expects to revise the figure downwards.

There was also a sharp rise in the number of people who have fallen behind with their mortgage repayments.

The number of homeowners with arrears of more than 2.5% of their mortgage balance rose by 62% year-on-year during the first quarter to 205,300, 12% more than during the previous quarter.

The CML said that although levels of arrears were continuing to increase, lenders were committed to working with borrowers who get into financial difficulties.

Director General Michael Coogan said: "It is quite clear that the number of arrears cases is rising far more markedly than the number of repossessions.

"Lenders are demonstrably increasing the forbearance they are offering, while many struggling borrowers have gained some breathing space through lower interest rates feeding through to lower monthly payments."

Lenders 'working with borrowers'

The Government has also launched a range of initiatives to help people who cannot keep up with their mortgages to stay in their homes.

These include enabling them to sell some or all of their home and rent it back from a social landlord, while those who have temporarily lost their income can defer a proportion of their mortgage interest payments for up to two years.

A new pre-action protocol has also been introduced under which the courts can grant a repossession order only if all alternatives to keep people in their home have failed.

Sam Younger, chief executive of Shelter, said: "There have been moves to help struggling homeowners but some lenders are clearly still not doing everything that they can to keep people in their homes.

"The figures also prove that Government announcements this week to help tenants of repossessed landlords must be implemented as fast as possible."

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