Prime house repossessions on the rise

By MoneyhighStreet Staff. Published on September 6, 2008 This post currently has no comments.

Jersey House
House repossessions have risen among borrowers of prime mortgages, research has shown.

A report by Moody''s revealed that both arrears and repossessions leapt up in the second quarter of this year.

Total repossessions compared to homeowner loans were found to have doubled, while those the number of residents with arrears exceeding 90 days had also increased.

This figure stood at 0.9 per cent at the end of June, compared to 0.6 per cent 12 months previously.

Nitesh Shah, Moody''s economist and co-author of the report, told the Financial Times: "The UK mortgage debt service ratio remains elevated.

"The ''payment shock'' to those mortgage holders coming off the fixed interest rate period of their mortgages may increase stress on householders."

However, the report also added that the situation is set to get markedly worse in light of the number of homeowners expected to be nearing the end of their fixed-rate deals.

"Arrears are thus expected to continue rising for some time," it stated.