The Treasury Select Committee is to launch an inquiry into Britain’s struggling mortgage market. It wants to examine the sharp rise in repossessions and the chronic shortage of affordable mortgages for first-time buyers
The inquiry will review the current forecast on the number of families who could lose their homes this year and look at lenders’ treatment of sub-prime mortgage holders.
The Committee will also look into the success of Government schemes designed to reduce the huge numbers of repossessions expected this year. Sale-and-lease-back schemes and the availability of mortgages will also be examined.
Written submissions have been requested from banks, building societies, trade bodies or any other interested parties by July 1 and the committee aims to report back before the beginning of August. The Treasury will have two months to respond to its recommendations.
The new inquiry was launched as a prominent economist warned that repossessions will not peak until 2011. Ian Shepherdson said repossessions will reach between 100,000 and 120,000 per year by 2011, as unemployment soars. The Office for National Statistics revealed this week that unemployment rose by 232,000 to 2.26 million in the three months to April.
However, the CML which has predicted that only 75,000 families will lose their homes this year, and may revise down the estimate after new figures showed that 12,800 households were repossessed in the first quarter of this year - less than expected.
There are forecast to be 500,000 households at least three months in arrears on their mortgages by December.


This news item courtesy of Tailored Home.