The Council of Mortgage Lenders (CML) fears that the period of almost continuous improvement in arrears and repossession may draw to a close, despite the release of data showing a decrease in activity in the first six months of 2002.
CML data shows the number of properties taken into possession the lowest since 1984 at 6,850. This figure is 12% lower than the second half of 2001 and 35% lower than 12 months ago.
The CML believes that high employment rates as well as the period of low mortgage rates have added greatly to the new figures but warns the trend could be reversed if unemployment were to rise in the next 12 months.
Michael Coogan, director general of the CML, said: ‘Borrowers often overestimate their ability to pay their mortgage if they lose their job, and now is a good time to take stock.’