Northern Rock suffers jump in repossessions

04/03/2009

Repossessions figures have risen sharply at Northern Rock, year-end figures from the bank show.

According to the report, a 63 per cent increase in customers losing their homes after falling behind on their payments was marked across the year.

Council of Mortgage Lenders figures recently found that total UK repossessions across all mortgage firims rose by just under 50 per cent in 2008.

Northern Rock almost collapsed in 2007 due to the onset of the credit crunch and was taken over entirely the following February.

Many customers migrated from the troubled lender last year, as it aimed to run down its mortgage book and offered relatively uncompetitive rates.

This meant that many of the borrowers who remained did so because they could not secure a deal elsewhere due to a poor credit history or struggles with repayments - partially explaining the sharp repossessions rise.

However, the bank recently said that it would increase its mortgage lending to customers - partly as a response to the continuing downturn in the property market.

Chief executive Gary Hoffman said: "Our return to the mortgage market will be governed by focussing on responsible lending, understanding our customers' needs and offering them great products and service.

"These qualities lie at the heart of the future success of Northern Rock."

Northern Rock also declared a 2008 pre-tax loss of £1.36 billion in the report.

Tags; Debt Management and Banking, Young Family Finances,

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