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House buyers turn to fixed-rate mortgages

Dominic Welling dominic.welling@consumerchoices.co.uk

Repossession levels are falling but homeowners are not out of the woods yet, according to new figures.

A total of 9,400 homes were repossessed in April, May and June, compared with 9,800 in the previous three months, according to the Council of Mortgage Lenders (CML).

This was also down from the 11,800 homes that were repossessed in the same period in 2009.

Repossessions have now been falling steadily since they hit a peak of 12,100 last September.

As a result the CML has revised its forecasts for 2010, and is now predicting 14,000 fewer repossessions this year - a total of 39,000 compared with the previous forecast of 53,000.

Meanwhile, the number of homeowners to fall behind with their mortgage payments also dropped in the last quarter.

However, Michael Coogan, director general of the CML, has warned that there is no room for complacency and the positive figures could be short lived.

He said the safety net for borrowers is weakened by the prospect of higher interest rates, a possible rise in unemployment, reduced government support for mortgage payments, and mortgage rescue schemes being reviewed as part of the deficit reduction plan.

Coogan added: "While we don't want to cry wolf, it seems obvious that the ongoing prognosis for arrears and possessions is far from a healthy all-clear.