‘Mortgage Prisoners’ and Fears of Repossession

It is no secret that the UK’s housing market has been one of the worst hit areas of the economy in recent years. But despite a 2% rise in prices in the last year, the latest consumer report by Which? has revealed continued concern about the current state of the property market.

Two thirds of people who have mortgages are worried about them, with 16% owing more than 4.5 times their annual income on their house. One reason for this may well be the distinct lack of high loan-to-value mortgages currently available. Despite the government’s Funding for Lending Scheme, the banks are still hesitant to dish out the cash where mortgages are concerned. This means an increased struggle for first time buyers, along with those who already have a mortgage frequently finding themselves stuck with their current deals, regardless of any decrease in rates.
These ‘mortgage prisoners’, as Which? calls them, are typically aged 30-49 and have substantially higher weekly housing costs: £186 per week, compared to the national average of £135. It comes as no surprise then that this particular demographic shows greater signs of stress and money worries.

Yet the report also gives some interesting geographical statistics. Apparently people living in Scotland and Wales are less worried about the value of their homes, despite prices falling in those areas in the last twelve months. Whereas London dwellers and people in Northern England demonstrate the most concern.

Unfortunately fears of repossession are also on the rise – playing on the minds of 20% of the UK’s homeowners. The average household with a mortgage (around 35% of the population) owes approximately £75,000, or median of £49,000; which in a recession is not the easiest debt to pay off.
One of the best ways to avoid repossession is to sell your house and release its equity. This is where Jemima Poppy can help. Our pledge is to give you certainty: once we have agreed to buy then we never back out. Not only this, but we offer expert advice – free of charge. So if you are unsure what to do then please do not hesitate to call us. We have a twenty-four hour message service you can get in touch with us at any time, day or night.