Darling wants more time for struggling homeowners
Tuesday, May 13th, 2008The Chancellor of the Exchequer, Alistair Darling, has once again been urging banks to help out with the chaos that the credit crunch is causing, this time asking banks to provide further aid for struggling families that are unable to keep up with their mortgage loans repayments. The chancellor has already been urging banks to make sure that they pass on the base rate cuts to borrowers in order to ease affordability and subsequently help to boost the economy.
Darling, along with the Housing Minister Caroline Flint, has been calling on major mortgage lenders to give more time to struggling families that miss mortgage repayments. Darling plans to address banks about the issue, claiming that his is a benefit that homeowner should be able to expect given the fifty billion pounds that the Bank of England has ploughed into the money markets in order to ease liquidity for lenders.
Around 27,000 families had their homes repossessed last year, which reflected over a 20% rise compared to 2006. The level of repossessions continues to rise, according to figures, and this is because so many people have been falling behind with repayments on their mortgages due to high repayments and rising living costs. In fact, officials from the Liberal Democrats claim that their studies show that around sixty thousand homes could be at risk from repossession.
Amongst the suggestions put forward to banks are providing borrowers with payment holidays, where they can take breaks from repayments at certain time of for certain periods, and extending the loan term in order to bring the repayments on the mortgage down.
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