The reason given for this is that lending criteria has become far stricter, making it harder for many consumers to get the finance they need, which includes homeowners that are looking for a better mortgage deal. The data comes following a survey that was carried out by the National Association of Estate Agents.

The survey by the NAEA showed that nearly one in every four homeowners in the UK was unable to get a new, more suitable mortgage deal as a result if tighter lending criteria, with around 22.5 percent of those polled by the NAEA stating that they could not get a better suited mortgage due to the current financial climate.

The results of the survey also showed that more than 50 percent of those polled thought that if lenders relaxed their lending criteria a little and reduced the level of deposit that they were demanding then these homeowners would have a far better chance of securing a new mortgage deal.

As part of the survey eighteen hundred homeowners were polled by the NAEA, and almost 60 percent of these said that in order to help the recovery of the property market lenders had to take measures to make it easier to get mortgage loans for consumers.

One industry official said: “We cannot let the banks convince us that shutting up shop when it comes to mortgage lending is a responsible move. The decision to restrict mortgages so severely is rooted in self interest. The Government must do more to put pressure on those banks that are refusing to lend, while highlighting those banks that are easing restrictions to help get the economy moving again.”

Almost 25 percent of homeowners cannot get a new mortgage loan is a post from: Glitec Loans

Many homeowners in the Wiltshire area may now find that help is at hand if they are struggling to the point where they could soon be facing repossession action, and this mortgage rescue scheme has been rolled out across the area by Wiltshire Council.

It is thought that many struggling homeowners could be helped under the scheme, and many others will benefit from valuable advice and assistance that is also available through the programme.

According to reports help could be available to households that have annual incomes of less that £60,000 in total. It is thought that this will include many people disabled people, elderly people, and families with young children, all of whom may be able to get help through this rescue scheme.

Industry officials are now urging households who are struggling and feel that they could be facing repossession to contact the council as early as possible, as there could be help available and there is plenty of advice on offer that could help them to avoid losing their homes. Alabaré Christian Care Centres is working in conjunction with Wiltshire Council in order to provide a money advice service to local residents that are struggling and are at increased risk of repossession.

One council official said: “In these difficult times it is important for the council to help out wherever it can. This scheme is one of many ways we are helping households through the recession. I would urge anyone at risk of losing their home to contact the council as soon as they become aware of debt problems, because help is at hand.”

Struggling Wiltshire homeowners now have help at hand is a post from: Glitec Loans

Industry officials say that the dramatic cuts in interest rates has resulted in homeowners pumping more money into repayment on their tracker mortgages, and many have kept repayments as they were even though interest rates have fallen, resulting in them clearing far more of their mortgage debt far more quickly.

It is also though that many people have decided that rather than pay their money into savings accounts, where at present it is earning little to no interest, they will put it towards repaying both secured and unsecured debt, where interest charges are still high. As a result of this there has been a significant impact on the repayment of both mortgages and unsecured debts such as loans, credit cards, and overdrafts.

One industry official said that the majority of people that were paying off their mortgages more quickly were those with tracker deals, who have been the main beneficiaries of the interest rate cuts, which have seen the base rate fall from 5 percent in October to just 0.5 percent by this March. She added that some of these homeowners had seen their mortgage repayments fall by up to 80 percent.

She stated: “In our view this is one important channel in which interest rates are working. Roughly 40% of the mortgages taken out in 2007 were trackers and so will have benefited fully from the decline in Bank Rate over the past 18 months. Because of falling house prices this money is being used to pay down debt rather than spent on goods and services.”

£8 billion of mortgage debt paid off by UK homeowners is a post from: Glitec Loans

In fact, it is estimated that the collapse in house prices in the UK has left around 1.2 million homeowners trapped in negative equity, where they actually owe more on their home than the actual value of the property.

Figures show that just a year earlier fewer than one hundred thousand homeowners were in negative equity, with house prices having boomed over the previous decade. However, for nearly a year and a half house prices have been plunging, and the number of people now in negative equity has rocketed. It is thought that one average those most likely to be in negative equity now are people that bought a property since 2003.

One economist warned that as house prices continue to fall around two hundred thousand homeowners a month are falling into negative equity. He warned that this figure could continue to increase, and that in total around three million homeowners could have fallen into negative equity before the house price crash comes to an end.

Another economist said that the falling house prices, amongst other factors, have resulted in people looking at properties but not actually buying them, which has also affected sales levels.

He said: ‘While the fall in house prices and the parallel reduction in interest rates has probably made many households curious about what is available in the market, many are likely to be hesitant to commit in a recessionary environment of rising unemployment and increasing uncertainty about future incomes.’

Over a million in negative equity is a post from: Glitec Loans

However, a group of analysts has recently released a report claiming that the figure for repossessions this year could be even higher than this estimate from the CML, stating that repossession levels could rise to as many as 90,000.

The report from the consultancy CB Richard Ellis claims that for every half a million job losses that occur there will be around twenty thousand repossessions, and with job losses expected to soar this year as a result of the ongoing recession this could lead to a far higher number of repossessions than originally anticipated.

The report states: ‘Loss of income through unemployment is the major contributory factor towards arrears and repossessions. Although the fear of losing one’s home means property owners do all they can to cover the mortgage payments, it can be increasingly difficult for the jobless to cover mortgage payments, particularly as government support does not kick in until 13 weeks after the job loss.’

The consultancy also blamed tighter credit conditions for the increase in repossessions, and it went on to state: ‘High mortgage rates are a particular problem for borrowers coming to the end of their current mortgage deal. These homeowners are finding it difficult to obtain a mortgage on comparable terms and may not be able to afford the higher rates. There are a large tranche of vulnerable borrowers which could increase the severity of the problem.’

Officials have said that those most likely to face the risk of losing their home over the course of this year include sub-prime borrowers, buy to let borrowers, and those with high levels of debt that are not equipped to deal with the economic downturn.

Analysts predict a greater number of repossessions this year is a post from: Glitec Loans

According to the City Watchdog, repossessions this year are up about 92% over last year. The statistics from the Financial Services Authority show that for the three month period ending on September 30, 2008 there were almost 14,000 homes reposed.

Due to falling house prices and people who have borrowed on the strength of equity in their homes, many homeowners are now finding themselves in a state of negative equity, which means they have an outstanding balance on their mortgage that is greater than the value of their home. During the current credit crunch, many people are losing their jobs with companies going out of business or downsizing.

Even those that are not in danger of losing their jobs are finding it a lot harder to manage their finances because of the rising costs of food, electricity and petrol. As a result the number of people who are behind in their mortgage repayments has jumped to 340,000, which represents an increase of 24% over the full year and 20% during the three month period.

According to officials of the FSA, they have seen increases in the last year and a half in the number of people who are in arrears equal to 1.5% of their mortgage debt to the tune of 4% per quarter. However, the 10% jump at the end of September was very significant because of the dramatic increase in such a short period of time.

During the third quarter of the year, even more people fell behind in their payments – a further 30,000 homeowners. Those who were in arrears were able to make a portion of their monthly mortgage payment, but this was less than half of what was required to keep the account up to date. Although repossession of home does occur every year, the lenders are usually able to sell off most of these homes to redeem the money that was borrowed.

Only a small percentage of those repossessed in the last year have been able to be sold with the number up from the average 7000 homes to 7,687. As a result there are approximately 27, 123 repossessed homes still unsold at the end of the last quarter – a number that represents an increase of 27% over the previous quarter and an increase of 111% over the same period of 2007.

These statistics are in keeping with those published by the Council of Mortgage Lenders. According the statistics of this organization, lenders that are members of the council were involved in the repossession of 11.300 homes during the third quarter of 2008. This number is an increase of 12% over the same time in 2007. The council also reported that the number of borrowers who found themselves in arrears on their mortgage during this period rose to 168,000, an increase of about 8%. This number is substantially lower than the figure reported by the FSA but there are differences in the way the two agencies measure the levels of arrears.

There is very little good news from the FSA with regard to the mortgage industry. Fewer loans for new homes are being approved. In the second quarter of 2008, the total amount of new mortgages approved by lenders amounted to almost £2 trillion. The third quarter of the year saw only a 0.5% increase over this amount. Net lending also dropped by 36% in this same period and advances were also lower by about 15%.

Increasing Numbers of Home Repossessions is a post from: Glitec Loans

New court protocols will help to protect homeowners who fall behind with their mortgage repayments, and could save some from having their properties from being repossessed. The protocol was put forward by the Civil Justice Council and was recently approved by the Master of the Rolls. In addition to these regulations the government is also looking at bringing sale and rent back firms under the regulation of the Financial Services Authority in order to protect consumers from unscrupulous firms that go back on their word about tenancies or pay homeowners a fraction of the property value.

Under the new court protocol lenders will have to use court action as a very last resort when homeowners fall behind with repayments, and must first follow strict guidelines in order to try and resolve the situation. This includes discussing options available to homeowners to help them with their repayments, and trying to agree alternative terms with the borrower in order to get the situation sorted out. If the lender does take the matter to court officials will need to prove to the courts that all other steps have been taken and exhausted.

The Chief Secretary to the Treasury, Yvette Cooper, stated: “We need to make sure we help those who might be hardest hit in the tougher times ahead, ensuring repossession is the last resort not the first. We also want to make sure that vulnerable homeowners are protected from exploitation and dodgy deals.”

The Justice Minister, Bridget Prentice, added: “The new Civil Justice Council protocol forms part of a wider package of measures which demonstrate this Government’s commitment to provide the best possible support to debtors and vulnerable borrowers. The protocol sets out all the steps that a lender should take before issuing mortgage possession proceedings. Lenders will be expected to consider ways of resolving problems outside the court system so that mortgage possession claims are only brought to court after all other suitable options have been exhausted.”

Margaret Becket, the Housing Minister, said: “We must ensure that every avenue has been explored before lenders seek to repossess homes. These new measures will further protect the most vulnerable households in the current economic climate. We have expanded free legal representation in county courts for households at risk of repossession, we have provided more free debt advice and will continue to work closely with lenders through this difficult time. It is important that households who have concerns over their mortgage seek advice at the earliest opportunity, starting by speaking to their lender.”

Could struggling homeowners get help due to new regulations? is a post from: Glitec Loans

Many of those expected to face repossession are homeowners that took out cheap fixed rate mortgages a couple of years ago, which are now due to come to an end. These people are likely to see their interest rates soar once their cheap fixed rate comes to an end, and this could see a sharp spike in repossessions. With a rise in repossessions expected the government is keen to take action to try and assist those in danger of losing their homes through repossession.

According to a recent report there are a number of steps that the government plans to take in order to try and ease things for those facing repossession and to ensure that they get the advice that they need. The housing minister Caroline Flint stated: “For the minority of owners who may need support and advice now, we want to ensure it is there for them in the right place and at the right time”

She also added that the situation was nowhere near as bad as it was in the 1990s, adding: “It is important to recognise we are dealing with an entirely different situation in the market from what was experienced in the early 1990s. The fundamentals of the housing market remain strong with high employment, low interest rates, and long-term demand for homes from first-time buyers.”

Recent additions:

• Estate agents at risk of problems due to mortgage and housing chaos
• Brokers complain over lack of access to mortgage deals
• Slump in lending levels fuelled by credit crunch
• Struggle continues for first time buyers
• Many lenders ignore base rate cuts

More help to be offered to homeowners facing repossession is a post from: Glitec Loans

Whilst interest rates have been cut twice in the last few months, homeowners are still battling to keep up with repayments as a result of the five rate hikes between August 2006 and July 2007. In addition to this many have been hit hard by other rises in costs, such as increased food prices, rising petrol costs, and increases in bills such as water and energy. The survey showed that around 84% of people in Britain are concerned about their finances.

In addition to this, 30% of consumers said that they did not know whether they would be able to cope for much longer, and it was revealed that many were concerned over the outcome of the recent budget.

One industry official said: ‘I am really surprised by the extent of worry out there. Close to a third of Brits have obviously been really spooked by the Budget. There is little doubt many Brits will find their annual road tax as high as the value of their car as from next year, creating a massive headache for people who are really struggling. These are some of the unintended but very real victims of the Budget. People from all walks of life and income levels are feeling the pinch from rising bills and taxes.’

Recent additions:

• Interest rates on personal loans continue to rise
• Loans market still suffering due to credit crunch
• Avoiding risks with an unsecured personal loan
• Keeping up with your secured loan repayments

Financial difficulties loom for homeowners is a post from: Glitec Loans

The term of the IVA is usually five years, and eligible consumers agree to make a set repayment each month, which is then distributed amongst the different creditors. The remainder of the debt following the specified term is then written off, leaving the borrower debt free.

The good thing about an IVA is that the person entering into the agreement does not have to lose their home in the event that they are a homeowner, and this comes as welcome relief to many homeowners who have huge unsecured debts that they can no longer manage to pay, as it gives them a chance to cut back their outgoings and get out of debt within the space of five years.

However, there is a downside, and this has been highlighted in a recent report, which claims that some homeowners that have entered into an IVA could soon find themselves having to pay a fortune in mortgage interest as the result of a clause that is in the IVA agreement. As part of the IVA the homeowner has to use the equity in his or her property in the last year of the agreement in order to put towards their debt, and experts have stated that this could cause a problem for some homeowners, as it could cost them dearly in terms of interest.

According to reports having to borrow against the equity in the home in the last year of the agreement means that some homeowners will have to take out a mortgage or secured loan at a far higher rate than the one that they currently have, and this is due to rises in interest rates. However, it does not end there. Another problem that these people are likely to suffer is the fact that they will be classed as high risk borrowers due to their IVA, and this means that they will be hit by even higher interest rates when borrowing against the equity in their homes.

An industry official from an insolvency firm recently stated: ‘There is a problem here. People in an IVA will be remortgaging into something significantly more expensive. Not only are mortgage rates higher than when these people bought their houses, but they could well be classified as sub-prime – that is to say as riskier borrowers who need to be charged more to compensate for that risk.’

IVA homeowners that are looking to borrow against the equity in their homes as part of their IVA agreement are advised to shop around and compare different mortgages or secured loans in order to find the most competitive deal, although they should be prepared for the higher interest rates that will be charged due to market conditions and due to their sub-prime status.

Recent Additions:

• Should you consider payment protection insurance?
• Sale and rent back scheme still being branded a rip off
• The first time buyer affordability crisis continues to hit
• What can you use a secured loan for?

Are you a homeowner on an IVA programme? is a post from: Glitec Loans