According to a survey by Moore & Blatch, 80 per cent of lenders believed that repossessions would increase in 2008.
Of those surveyed, 40 per cent believed that there would be a 10-15 per cent increase while 8 per cent anticipated an increase of over 15 per cent.
The most vulnerable group were first-time buyers, with 32 per cent of lenders believing that there would be an increase in shortfalls after the sale had gone through.
Meanwhile 68 per cent of lenders believed that buy-to-let (BTL) possessions would increase with new build flats most at risk.
Secured loan borrowers also expected to see an increase in repossessions, with 32 per cent of respondents seeing an increase in providers repossessing properties.
Paul Walshe, head of lender services at Moore & Blatch, said: “There is no data on how many second charge repossessions there are, but they are increasing. It is a good way out for some people as they will get lower rates than on credit cards, but some people will start overspending all over again.”
Meanwhile, Shelter has called on the government to give greater assistance to those facing repossessions.
The charity has called for the Financial Services Authority (FSA) and the government to increase regulation around affordability.
As part of the proposals detailed in its report Shelter called for the FSA to include second charge lending and BTL lending in its regulatory scope.
Phil Rickards, head of sales at BM Solutions, commented: “It looks like repossessions will be a hot topic in 2008, and it’s sure to generate a lot of interest.
"However, in terms of regulation, all of our BTL business comes through regulated intermediaries, so we already treat it as a regulated market.”
