Healey’s comments come hot on the heels of figures from the Council of Mortgage Lenders which showed that 46,000 homes were repossessed in 2009.

Speaking on Radio 5 Live, Healey said: “For some people it can be the best option for them to allow their home to be repossessed… even in cases [where lenders look at repossessions as a last resort] some families may not be able to keep up with mortgage repayments even if they’re re-negotiated and rescheduled.”

Healey did acknowledge that each individual circumstance was different, but his comments have drawn criticism from shadow housing minister Grant Shapps and housing charity Shelter.

More to follow.

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