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Your Money > Mortgages Articles > Repossession hotspots revealed
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By John Fitzsimons
From the onset of the credit crunch, the big worry for everyone has been the issue of repossessions. The media was full of horror stories about borrowers starting to struggle with their mortgage payments, and unscrupulous lenders giving them no breathing space, immediately opting to begin repossession proceedings (the Government-owned Northern Rock was highlighted as a particular offender ). To add insult to injury, if you own a property in one of England's "repossesion towns", then your property is more likely to be de-valued by local repossessions. While things have calmed down a touch, following yet more Government intervention in ensuring repossession is only a last resort , it remains the elephant in the corner, the issue still there but not really being discussed.
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And now the Government has highlighted just which areas are most at risk of the dreaded R word. The list has been put together as part of a Government campaign - including ads in newspapers, online and on billboards - to improve awareness of the Government's advice networks on the issue of repossessions. Since April 2008, more than 300,000 homeowners have received help and advice in paying their mortgage. If you are in the West Midlands and the North West, then brace yourselves.
The danger list Below are the 22 towns identified by the Government as the areas with the highest proportion of homeowners at risk of repossession. 1. Barking and Dagenham 2. Birmingham 3. Bolton 4. Cannock Chase 5. Corby 6. Halton 7. Kingston-upon-Hull 8. Knowsley 9. Liverpool 10. Manchester 11. Newham 12. Northampton 13. Nottingham 14. Reading 15. Redditch 16. Salford 17. Sandwell 18. Sunderland 19. Swindon 20. Walsall 21. Wigan 22. Wolverhampton It's clear to see that towns in the West Midlands and the North West make up the bulk of the repossession hotspots, though East London is far from safe with both Newham and Barking and Dagenham flagged as danger areas. The list has been put together as part of a Government campaign - including ads in newspapers, online and on billboards - to improve awareness of the Government's advice networks on the issue of repossessions. Since April 2008, more than 300,000 homeowners have received help and advice in paying their mortgage. How big a problem? Of course, from the onset of the credit crunch, there have been grave warnings about just how bad the repossession situation was likely to be in the UK. But the truth is that things have never got quite as bad as those initial warnings made out. The Council of Mortgage Lenders, the trade body for lenders, initially predicted repossessions for 2009 to stand at 75,000. However, by June it had admitted this was quite significantly out of line, revising that forecast to 65,000. And according to its own figures, in the first half of the year, there have been just 24,100 repossessions. So things will still have to deteriorate quite significantly if its predictions are to be borne out. Arrears of the year It's a similar story with arrears (i.e. falling behind with your mortgage payments). Again, the Council of Mortgage Lenders spread a message of doom, forecasting 500,000 borrowers to be at least three months behind on payments by the end of 2009. That has since been revised to 425,000. At the end of June, there were only 270,400 borrowers in this position. Indeed, even being in arrears is not as bad as it seems. Take the research published last week by the Building Societies Association, which found that 97% of borrowers that have fallen into arrears in the last two years remain in their homes, and are now repaying the mortgage again. According to the research, a third have repaid their arrears in full, with 41% in the process of repaying their arrears. And the key factor in them retrieving the situation is getting advice, whether from the lenders themselves or from a professional outfit. What to do if you're in arrears It's that word - advice - that is fundamental. Everyone in the industry agrees that the best way to get out of arrears, and stave off the threat of repossession, is to talk to your lender as soon as you start to experience difficulties. The earlier the better. It also makes sense to get independent advice as well, but I would always warn against debt management companies. Undoubtedly some offer a decent service, but if you can get the same expert advice for free, then it's crackers to actually pay for it. Instead, you should start with the Government's own Mortgage Help website , which gives all sorts of advice, whether you are just starting to experience difficulties in paying your mortgage each month, or whether proceedings have already been initiated by your lender. It also includes a host of real-life stories which outline in detail how the Government's programmes can help, while there is also a Directgov page providing plenty of advice, with instructional videos as well. There are a bunch of other organisations which provide great debt advice absolutely free. They include outfits like Citizens Advice , National Debt Line and the Consumer Credit Counselling Service . Yes, repossessions will be a fact of life for a while yet, irrespective of the more positive noises beginning to come out of the housing industry. And while certain areas have been hardest hit, falling into arrears does not mean you are inevitably on the path to losing your home. The key is to face up to your difficulties early, and speak to professionals. More from lovemoney.com Useful links: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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