The mortgage arrears statistics published each quarter rightfully get a lot of attention but included within the releases are figures which get little attention. These are the repossessions and court proceedings statistics that are also published. The focus here is only on the figures that relate to primary dwelling houses; buy-to-lets are not covered.
One reason they are not covered is that a useful time series of the data is not provided and the relevant numbers are only included in the text accompanying the statistics rather than in tabular form. The following table collate the figures from the quarterly releases to date.
First, is the number of repossessions.
In the last four years 2,386 houses repossessed. Of these, 70% have been repossessed through a voluntary surrender by the borrower. There have been just 738 court-ordered repossessions, less than 200 a year. Given the scale of the mortgage debt crisis we are in this is an incredibly small number.
Of the court-ordered repossessions it has been indicated that close to half are at the behest of sub-prime lenders who make up about 2% of the outstanding mortgage debt.
One important outcome that is missing is where a borrower is pushed into a forced sale of the house by the bank. This does not appear in the repossession figures as the bank does not take ownership of the property but the loss of possession for the borrower is the same. A related issue is what happens to any shortfall that might remain on the mortgage after the forced sale is concluded.
Next, we have the number of court proceedings issued and concluded each quarter.
There was a massive jump in the number of court proceedings issued in the last quarter. This is likely related to the lacuna in the law identified through ‘The Dunne Judgement’. This was recently resolved.
It can be seen that of the court proceedings concluded roughly half end with the granting of an order for repossession (though some are merely to formalise a voluntary surrender) and half are concluded by other means. Most of these see the borrower and lender enter a new arrangement through a restructuring of the original loan agreement with others ending by way of voluntary surrender/abandonment. Again no detail of forced sales is provided.
There have been 1,957 court-orders for repossession granted. There have been 738 court-ordered repossessions over the same period. Some of the repossessions orders are granted to formalise a voluntary surrender/abandonment that has already occurred and even though a court-order is granted the lender and borrower may enter a restructuring arrangement to try and avoid an actual repossession. Although the six-fold jump in the number of court proceedings issued this quarter may change it, there does not appear to be a significant back-log of court orders for repossessions waiting to be enforced.
The third element available is the number of properties that are in the possession of the lenders. This increases with the repossessions of the first table and is reduce by the properties sold shown here.
Over the past four years the lenders have sold just over 1,500 properties which were repossessed as PDHs and continue to have another 1,050 in their possession.
Finally, the figures previously includes the aggregate number of active court proceedings which had been issued and the number of formal demands which were outstanding. These aggregate figures have not been published since the second quarter of 2012.
It is not clear why these figures are no longer reported. Q3 2012 was the first quarter when arrears figures for the Buy-to-Let sector were provided but it may not related.Tweet