Increasing numbers face repossession

1:09am Saturday 10th May 2008

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The number of people who face losing their homes in Bradford has soared by almost a third as the credit crunch continues to bite.

Mortgage lenders took out 437 repossession "actions" in county courts between January and March this year - up 30 per cent on the same period of 2007.

An "action entered" is the first step in the process for seizing a property, where a lender issues a summons in a county court.

A claim action comes before mortgage possession orders, when a court grants an order for possession of a home. The number of repossession orders actually made in Bradford was 319 - a 27 per cent increase compared with the same period in 2007.

The figures do not reveal the actual number of repossessions because even after an order has been made, a person can reach an agreement with the lender.

The statistics, published by the Ministry of Justice, prompted a warning that interest rate rises by many lenders were beginning to bite.

A spokesman for Skipton Building Society said repossession was a last resort and, because an order had been granted, it was important to remember an agreement could still be reached.

He added: "An order does not mean people are out of their homes. If you think about the number of people who live in the area, 319 is relatively small. We are coming from a really low base because of the way prices have been. Because the economy has been high, the numbers have been at a low.

"A small increase in numbers will look big with the percentage increase."

He added that the credit crunch is not entirely to blame as it will take up to a year for any action to be taken.

"Repossession is a last resort not the norm. If you are in a difficult position lenders will listen. There is a level of responsibility and if someone keeps up the agreed payments agreed they will stay in their home.

"It is not only mortgage lenders who can take action in court but if someone has taken a consolidation loan out secured against their property."

A spokesman for Bradford & Bingley said: "Arrears and possessions figures continue to account for a relatively small percentage of the mortgage market.

"We would advise anyone who is struggling to meet their monthly mortgage repayments to contact their mortgage lender as soon as possible to see if their mortgage lender can help them."

Housing Minister Caroline Flint yesterday announced measures to help those struggling and face losing their homes. There will be more specialist debt advice training for Citizens Advice Bureaux staff and local authorities, work with lenders to ensure they offer more help to those facing difficulties and strengthened help from the National Housing Advice Service.

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