Mortgages Uncovered

FSA say that mortgage arrears have been steadily increasing since early 2007.

The amount of accounts that have shot up into arrears is 31% in 2008 say recent statistics from the Financial Services Authority (FSA).

There were 377,000 mortgage accounts in 2008 that had reached 1.5% in arrears.

Home owners in trouble currently hold loans worth just over £40 billion.

Recent government figures show that the speed of prices has increased downwards in property values.

“With borrowers increasingly struggling to clear their arrears, the total number of loan accounts in arrears has been steadily increasing since early 2007. Self-certified mortgages have produced the greatest arrears problems for troubled lenders such as the Bradford & Bingley, and are sometimes referred to as “liars loans” as people have exaggerated their incomes to obtain a mortgage.”

Said the FSA.

Department for Communities and Local Government said;

“The DCLG index is currently showing a similar trend in annual house price rates to other indices available from commercial sources,” it said. The price of homes bought by first-timers fell by 15.4% in the year to January, compared with a drop of just 10% experienced by homes being bought by former owner-occupiers. Prices have been falling fastest in Northern Ireland, down 14.3%, and are still highest in London, where the average home costs £301,383.”