Interest rates and government intervention helped repossession levels

According to figures that were recently published there was a significant drop in the number of repossession in the UK in the final three months of last year.

The reports also suggested that the level of mortgage arrears had also fallen over the same time period. This came despite financial problems that many were experiencing as a result of the recession and the global credit crisis.

It has been suggested that the fall in repossessions and mortgage defaults may be the result of the rock bottom base interest rate, which still stands at 0.5 percent, and various measures that have been put into place by the government.

With the next general election looming just around the corner the news of the drop in repossessions and mortgage defaults will be welcomed by members of the labour party, and the party is likely to be keen to take some of the credit for the fall in repossessions and defaults in the hope that this will help to sway voters to keep Labour in power.

Over the past year the Labour government has put into place a range of initiatives and schemes, and these may have party helped to bring repossession numbers down and increase affordability for struggling homeowners.

It is thought that around 330,000 families may have benefitted from the initiatives that the Labour government has put into place over the last year.

However, an official from the Council of Mortgage Lenders said that it was a combination of factors that had affected these figures. He said: “The fact that mortgage arrears and possessions did not rise by as much as we feared in 2009 is testament to the effect of low interest rates and a great deal of concerted effort by lenders, government and the advice sector to help borrowers to address financial difficulties when they occur.”

Tags: United Kingdom, mortgage, Labour, government, general election