7 Million Homeowners Will Face Debt Crisis As Repossessions Set To Riseposted on 19 January 2011 | posted in General Category | ( 0 ) CommentsMore than seven million homeowners could be affected when interest rates begin to rise, and the number of people being evicted from their homes will rise this year, as banks lose patience with home owners who fail to keep up with their mortgage payments. Advisors at Integrity Debt Solutions have warned that the increase will put extra strain on already mounting debts in households, as well as the VAT rise, household inflation and the risk of un-employment, which will only add to the number of people declaring themselves insolvent in the coming months. "Personal Insolvency figures are now starting to creep up, and the concern for 2011 is that they will increase dramatically". With the Bank of England`s base rate sitting at an all-time low of 0.5% since March last year, low interest rates have made variable-rate and tracker mortgages attractive options to homeowners. But because these mortgages are tied to the base rate - unlike fixed-rate deals - their rates could rise in the coming months. There are mixed views on when the base rate will increase, but the Bank of England could come under pressure to up the rate in the coming months if inflation remains high. Nobody knows quite when interest rates will rise, but when they do a large number of people will struggle with their mortgage debt. Not only this we will also see an increase in home repossesions. The Council of Mortgage Lenders says for this year, it predicted not more than 53,000 repossessions. However we now know that the figure is considerably higher than this. If 53,000 or more homes were taken back this year, it means that more than 1,000 households a week would have been affected. This further means thousands of people will be left homeless and this by no means is a small figure. This can add to debt problems and an obvious increase in people seeking debt help. This will only increase the numbers of people going bankrupt or entering into an individual voluntary arrangement (IVA). If you are behind with your home loan, remember that by taking measures now you can ensure that your home remains safe. One measure that you should immediately take is to seek debt advice. If you are worried about further costs, we will provide debt advice for free and it can throw light on the various debt solutions available that can help you get hold of your debt situation before it spirals out of control. Homeowners who are only just able to cover their mortgage payments now could find those payments completely unmanageable once rates go up. When you consider that rates are unusually low and could increase by several percent over the next few years, it`s clear that this could be a serious problem. But remember, home repossessions in the UK could reach 175,000 by 2012. We strongly advice people to consider their options and seek immediate debt advice if they are concerned about their ability to make repayments on their homes. We also advise people who are struggling with personal un-secured debt and own property, to seek advice and find a way forward. Leaving it too late could mean that you lose your home, but by being proactive and contacting us could mean that you don't. Call now for free impartial and professional advice- 01743 272900 Share this blog entry:
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