Business in Reading - Home Owners Facing Debt Problems

Worrying Numbers of Home Owners in Reading Facing Debt Problems

Reading East MP, Rob Wilson, expressed his concern at new figures which warn that 5 million families across Britain could be at risk of defaulting on mortgage payments and losing their home.

The analysis, conducted by The Spectator magazine using data from credit agencies, shows that 2,941 households in Reading East and 4,456 in Reading West have a ‘sub-prime loan exposure’, and may be now struggling with debt.

This comes as the latest official Government figures show that 17,831 homes across the South East were hit with repossession orders last year, with 525 orders being issued by Reading County Court. The Bank of England has also warned that banks and building societies are planning to cut back their lending further in coming months.

The crisis in the credit market is reducing the availability of cheap loans and mortgages, hitting people on the housing ladder and those not yet on it. This year, 1.4 million mortgages will come to the end of their fixed rate periods. As interest rates are higher now than they were two years ago, this could add £200 to the average monthly mortgage bill, placing yet more pressure on severely stretched family budgets.

Rob is calling on mortgage lenders to do more to help these families by:

• Contacting home owners 3-6 months before the end of their fixed rate mortgage period,
• Offering free financial advice, and
• Not imposing sudden hikes in repayments.

First time buyers are suffering from the credit crunch too, as mortgage lenders are demanding larger deposits. In response, Conservatives are calling for stamp duty to be abolished by the Government for first time buyers, for homes up to £250,000.

Rob said:
“This week has brought more worrying evidence that under Gordon Brown, our economy is built on debt. Labour’s record is one of economic incompetence.
Thousands of families across my constituency are now exposed to the possibility of losing their home. With many households facing soaring bills as their fixed rates come to an end, mortgage lenders should do more to help home owners with the soaring cost of living and help reduce the hardship under Gordon Brown’s Government. We have had ten years of benign world economic conditions, so iIt is incredible that Labour has failed to prepare the UK economy to cope with a downturn.”

Alok Sharma the Conservative Parliamentary Candidate in Reading West said:
"Gordon Brown, the self-styled "iron" chancellor, is looking very rusty right now. It has been under Mr. Brown's stewardship of the economy that personal debt in mortgages, credit cards and personal loans has been allowed to grow unchecked and reached a shocking £1.35 trillion last year - more than Britain's annual GDP! But none of this should come as any surprise, Mr. Brown himself has been busy increasing our national debt to fund his flawed policies out of trouble - the problem of course is that as the music stops it is the hard pressed taxpayers in Reading who are having to pick up the bill for Labour's economic incompetence once again."

For further information, contact Rob Wilson MP on 07973 834035.

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