Moore Blatch stated that while headlines focus on the number of properties taken into possession, they fail to account for the hidden majority that result in sale by the borrower to avoid repossession.
DCA figures show that the number of Court possession orders in 2006 rose to 89,857, the highest figure since 1993, yet of those 19% resulted in repossession compared with 56% of the 105,283 possession orders made in 1993.
The continued buoyancy of house prices means that many people who would otherwise face repossession are instead selling their properties and returning to the rental market.
Paul Walshe, head of lender services, Moore Blatch, commented: “Many people who are struggling to pay their mortgage are just selling their property. This is fine whilst the market remains strong, but the recent rises in interest rates are likely to dampen demand and may well result in some of these ‘hidden repossessions’ becoming real repossessions.”
