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Missed Payments Reflect Consumer Strain
Homeowners are feeling the pinch of successive interest rates hikes in the past and it is being reflected through rising missed payments on mortgages.
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London (longdogfinance) January 30, 2008: According to a poll from price comparison site MoneyExpert.com, around 463,000 failed to meet repayment deadlines on their mortgages in the last six months. This group of people comprise 4% of the total 11.8 million outstanding mortgages in the nation.
The results are based on a poll involving 2,082 adults. There are strong indications that this year is going to be one of the most difficult years because of the fallout from the last year’s credit crunch that resulted in high borrowing costs and lack of enough money in the market.
The experts are predicting a substantial increase in the number of insolvencies in the current year. The chartered accountant Grant Thornton has predicted that around 28,000 people may become insolvent in the first three months of 2008; one-third of whom are likely to file for bankruptcy as a direct result of Christmas loans.
Christmas debts have added to the woes of the consumers. The Bank of England’s
December rate cut should ease the pressure on household finances, amid speculations that another rate cut is very much on the cards. Any reduction in interest rate will bring down the monthly repayments on mortgages, secured loans and other personal loans.
Sean Gardner, chief executive of MoneyExpert.com said: “Missing a mortgage payment doesn't incur an automatic charge like failing to pay your credit card bill, but it is a sign of real distress, as keeping a roof over your head should be the priority for most of us. It's clear that many homeowners are feeling the strain of successive interest rate hikes.”
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Keywords:
unsecured loan
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