Low mortgage rate deals help to reduce house repossession.

Low mortgage rate deals  coupled with lender generosity  have reduced home repossessions to the lowest level for the past five years. CML figures showed approximately 8,500 homes had been repossessed in the final quarter of 2011, which was a 9 % reduction on the previous quarters figures. The total number of repossessions for 2011 was brought down to just over 36,000.

Banks offering low mortgage rate deals are allowing borrowers the space to breath once they fall behind on their mortgage payments. Despite the fact borrowers have experienced difficult economic times, repossessions have managed to remain level, which is an indication that borrowers are experiencing very favourable mortgage terms. Lenders have also tended to allow borrowers to retain their home, holding back on forcing a sale because they reason they will have more success in recovering mortgage arrears that way. It is also true that banks are very keen to avoid negative press which may be part of the reason for their generosity.

The tolerance that lender are showing owner-occupiers is not being shown to buy-to-let investors though. Data reveals that repossessions in the buy-to-let sector increased throughout 2011. The CML have commented on this development advising that lenders offer more help to landlords.

Despite repossessions remaining level, the CML feels that it is important to warn home-owners that lenders forbearance will not last forever and times will be tougher this year. While low mortgage rate deals combined with lenders good mortgage management has helped borrowers in financial difficulty, the situation is unlikely to last much longer. In light of wider economic difficulty and rising unemployment, a higher number of borrowers are likely to face serious financial problems this year.

Deal Direct can help you get a low mortgage rate deal today.

Contact us by filling in our enquiry form

or

telephone 0800 048 8828 and let our skilled mortgage advisers do the rest.