Repossessions Are Rising
Recent figures from the Council of Mortgage Lenders (CML) indicate a massive increase in the number of people losing their homes since 2007. With 40,00010,260 repossessions in 2008 and an expected 75,000 in 20095 it seems that as many thousands of borrowers struggle with excessive mortgages this figure will contiue to rise in 2006.
Equally of concern is the number of homebuyers who are in arrears with their mortgage repayments. A dramatic rise in the number of people behind with their payments is expected this year and the view of mortgage lenders is that this is set to make a bad situation worse.
Mortgages of five times the average salary are now commonplace amongst homeownersbuyers and the reality is that people haveare borroweding too much.
The global recession has had a major impact on economies around the world and has equally impacted many thousands of families here in the UK. There are a number of reasons why people are struggling with their debt but the impact of high unemployment and excessive debt has really taken it’s toll over recent years.
. Wage inflation is lagging behind increases in house prices, unemployment is currently at over 2.5 million which is a a 153 year high and the security of employment is no longer something which most people enjoy.
Short and medium term periods of illness usually never used to be a long term problem but now people quickly find themselves experiencing difficulties they just can not get themsleves out of.
The word in financial circles is that the whilst the Bank of England is currently doing its best to hold the base interest rate at its current level, it may be forced to increase interest rates during 201006 which will only help to worsen the situation for many households across the country.
This trend appears set to continue and combined with increases in taxes, other financial committments and general outgoings the outlook for the average household currently appears bleak.
The reality is that the financial problems we are experiencing are not likely to go away fast and we will be feeling the repurcussions for years to come.
What Can YOU Do Now?
Overpay on your monthly payments
Ask your lender if you can overpay your mortgage. This will help you when times become tough. Most lenders will accept this and it should enable you to take a break or reduce repayments if you need some time to get back on your feet.
Get Insurance Protection
Paying regularly into a Mortgage payment protection scheme will help you should you suffer illness, sustain an injury or become unemployed. Designed to pay out a certain amount each month for some people this has been a saviour.
Available from many of the leading insurers we recommend you shop around for the best deal but remember this will normally only cover you for a set period – usually around 12 months.
Okay so you have heard this one before, but it really is the best way to ensure you protect yourself for the future. Putting a regular amount in the bank or savings account can help. Savings Rates vary but currently up to 3.24.9% can be obtained from high street lenders, although the best deals are often found in the form of savings bonds and are generally found on-line.
Whatever the reason, making regular savings will help you – so keep saving, you never know when you will experience that rainy day.