Mortgage difficulties 'more likely'

Thu 29 May 2008 - Published in Mortgages

Although there is likely to be a rise in the number of people getting into difficulties with their mortgage payments, the problem is not going to be as large as it was in the early 1990s, an expert has argued.

Bernard Clarke, a spokesperson for the Council of Mortgage lenders, said that due to the current economic circumstances, it is likely that there will be a rise in the number of people who are suffering with mortgage problems.

"As a result of the credit crunch there is a shortage of mortgage funding so some customers coming to the end of fixed rate deals may find it more difficult to remortgage to deals that were as attractively prices as before," said Mr Clarke.

He added that it is these people who are most likely to suffer from tighter financial markets.

And given the current market circumstances, it is unsurprising that there will be more arrears and possessions taking place over the course of 2008, he said.

Research from insurance firm AXA revealed that at the end of 2007, 0.48 per cent of all mortgages were more than six months in arrears.

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