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20/02/2009
Sub Prime Borrowers 'At Risk'
Thousands of homeowners with sub prime mortgages are at risk of losing their home in the next six months, Shelter has revealed.
A poll, carried out for Shelter by YouGov, shows more than 22% of respondents - around 160,000 households - admit to struggling or falling behind with their monthly mortgage payments. Five per cent, around 37,000, expect to be repossessed in the next six months.
Shelter Chief Executive Adam Sampson described the figures as 'terrifying'.
He said: "Homeowners who borrowed in good faith during the boom now finding themselves among the most vulnerable to repossession. Now for the first time we can reveal the true extent of the credit crunch and the destruction sub prime is yet to have on the housing market."
Shelter believes the situation will get far worse with thousands of sub prime borrowers looking for new deals when their fixed rate ends later this year.
Mr Sampson added: "With sub prime mortgages drying up and mainstream lenders only looking at buyers with huge deposits, homeowners with sub prime mortgages now have nowhere to go.
"These homeowners were desperate to get onto the housing ladder, now they’re stuck out on a limb with many facing unaffordable mortgages, negative equity and rising debt."
Shelter is calling for the Government, lenders and the FSA to work together to provide a package of real help to struggling sub-prime borrowers who have been caught out by the credit crunch, with borrowers being treated fairly by lenders.
(CD/JM)
A poll, carried out for Shelter by YouGov, shows more than 22% of respondents - around 160,000 households - admit to struggling or falling behind with their monthly mortgage payments. Five per cent, around 37,000, expect to be repossessed in the next six months.
Shelter Chief Executive Adam Sampson described the figures as 'terrifying'.
He said: "Homeowners who borrowed in good faith during the boom now finding themselves among the most vulnerable to repossession. Now for the first time we can reveal the true extent of the credit crunch and the destruction sub prime is yet to have on the housing market."
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Shelter believes the situation will get far worse with thousands of sub prime borrowers looking for new deals when their fixed rate ends later this year.
Mr Sampson added: "With sub prime mortgages drying up and mainstream lenders only looking at buyers with huge deposits, homeowners with sub prime mortgages now have nowhere to go.
"These homeowners were desperate to get onto the housing ladder, now they’re stuck out on a limb with many facing unaffordable mortgages, negative equity and rising debt."
Shelter is calling for the Government, lenders and the FSA to work together to provide a package of real help to struggling sub-prime borrowers who have been caught out by the credit crunch, with borrowers being treated fairly by lenders.
(CD/JM)
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