CML revises repossession forecast downwards

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by Kay Murchie

The Council of Mortgage Lenders (CML) has revised its forecast for the number of homes expected to be repossessed in 2009 from 75,000 to 65,000.

The figure is still the highest since 1992 and almost two-thirds higher than the 40,000 people who lost their homes last year.

However, the group said borrowers are now benefiting from lower interest rates, together with Government initiatives and “significant levels of forbearance being shown by lenders“.

Furthermore, the CML said it’s rethink comes as a scheme providing last-gasp free advice in courts in England was extended.

However, the group does point out that it is still too soon to suggest that a “robust recovery” in the housing market was underway.

In the meantime, the CML has revised its forecast for net mortgage lending, which excludes redemptions and repayments, during the year. The group now expects this measure to be broadly stable at minus £5 billion, meaning homeowners repay £5 billion more to lenders than they borrow, a significant improvement on its previous forecast that net lending would be minus £25 billion during the year.

More figures on the number of repossessions are to be published by the Financial Services Authority later.