Local Repossessions Soar

1.39.24pm UTC (GMT +0000) Fri 26th Jan 2007

Debt pressures are forcing growing numbers of local families to fall behind with their mortgage payouts setting them on a road to repossession by banks. Vincent Cable warns that with rising interest rates "we are approaching a crisis level, as in the early 1990s."

The latest London figures show that local courts have registered big jumps in repossession orders. Brentford has seen a rise from 207 in the first nine months of 2005 to 302 in the same period in 2006 and Kingston from 132 to 184. Vincent Cable warns that even these figures "massively understate the problem. They take no account of recent interest rate rises. And we know that for every repossession, there are around seven more in the pipeline for which action has started."

"I have been warning of the dangers of irresponsible mortgage lending for several years and now, sadly chickens are coming home to roost. I met the chief executives of the leading UK banks at the British Bankers Association during the week and pointed out that there are few safety nets - benefits or insurance - if mortgage arrears deteriorate; but they see this as the borrowers' problem, not theirs".

"Although this is a national problem it is acute locally because of soaring local house prices and I am getting a steady flow of distress cases to my advice surgery".