SMI saves 250,000 familes from reposession in last 3 years

Graham_Devon

The Government should give struggling mortgage borrowers more help to avoid repossession by keeping some temporary benefit arrangements in place for at least another year, lenders have urged.

The Council of Mortgage Lenders (CML) said that repossessions have so far been kept down to a much greater extent than predicted due to the Support for Mortgage Interest (SMI) scheme, which helps those who are having trouble with their mortgage payments.
The CML said that a more generous availability of SMI has helped a decline in repossessions over the last couple of years, which dropped to 37,000 in 2011. But it expects to see repossessions rise to 45,000 this year, due to the uncertain economy and tough employment conditions, at a time when household budgets remain under huge pressure.

The body, whose members are banks, building societies and other lenders, said that the decision to offer SMI on more generous terms over the last three years had helped nearly 250,000 people to remain in their homes at any one time.

It said two changes to the scheme had played a "critical" part in keeping repossessions down - the introduction of a shorter three-month qualifying period before people receive help instead of 39 weeks and a temporary extension to the size of loans covered by SMI from £100,000 to £200,000.

A few of us are often asked what props are out there in the housing market.

SMI has also been denied by some as having a real effect on reposession rates, rather trying to make out the market is healthy.

I, and this data, begs to differ. 250k households saved from reposession in the last 3 years is a MAJOR influence to the market. The CML are obviously asking for more, as many are now hitting the end of the support.

I've personally been arguing that SMI is a big influcence for a while, but with no data, have not been able to back it up. Got the data now. Theres nothing healthy about the market, and you simply cannot compare repo's in the 90's to repo's now based on this intervention, to make out the housing market is rather healthy.

System

At this risk of letting myself in for an hour of anguish, where's the data? The CML have a vested interested in keeping SMI going.

Graham_Devon

Joeskeppi wrote: »

At this risk of letting myself in for an hour of anguish, where's the data? The CML have a vested interested in keeping SMI going.

I guess it's CML data. Just like the rest of the data they release which is never questioned?

abaxas

Anyone know how many houses have been sold in the last 3 years?

(note for the bulls : property sales not mortgages sold)

the_flying_pig

i don't mind the concept of keeping people in the same home whilst they're not earning, it might well be cost-efficient given that there are moving costs & so on, but what would be fairer [to taxpayers] is if mortgage holders were obliged to run down any equity that they have above a certain threshold before getting help.

System

Graham_Devon wrote: »

I guess it's CML data. Just like the rest of the data they release which is never questioned?

I think your confusing CML data, which we discuss at great length, with this, which isn't data. I can't find anything about this on the data section of their site either. It'd be interesting to know how they came to this figure.

Graham_Devon

Joeskeppi wrote: »

I think your confusing CML data, which we discuss at great length, with this, which isn't data. I can't find anything about this on the data section of their site either. It'd be interesting to know how they came to this figure.

I take it along with disputing what was said before the data, you are now disputing the data?

chewmylegoff

abaxas wrote: »

Anyone know how many houses have been sold in the last 3 years?

(note for the bulls : property sales not mortgages sold)

About 2.5 million I think.

chewmylegoff

Graham_Devon wrote: »

A few of us are often asked what props are out there in the housing market.

SMI has also been denied by some as having a real effect on reposession rates, rather trying to make out the market is healthy.

I, and this data, begs to differ. 250k households saved from reposession in the last 3 years is a MAJOR influence to the market. The CML are obviously asking for more, as many are now hitting the end of the support.

I've personally been arguing that SMI is a big influcence for a while, but with no data, have not been able to back it up. Got the data now. Theres nothing healthy about the market, and you simply cannot compare repo's in the 90's to repo's now based on this intervention, to make out the housing market is rather healthy.

I'm not sure that 250,000 over three years is what they are saying. It seems to be suggesting that upto 250,000 people were in receipt of SMI at any one time, therefore the actual number helped by SMI during that three year period could be much larger than 250,000 in total. However presumably the outcome would not have been repossession for everyone of these people (and is it people who have benefited or households - it does say people which could mean the total number of people who have benefited rather than the claimant count, so 250,000 people would amount to 100,000 households).

Seems a bit of a throwaway comment from them without further analysis of the figures.

System

Graham_Devon wrote: »

I take it along with disputing what was said before the data, you are now disputing the data?

Lost me. There is no data to dispute.

Looks like cmlo might have nailed it above.

HAMISH_MCTAVISH

the_flying_pig wrote: »

i don't mind the concept of keeping people in the same home whilst they're not earning, it might well be cost-efficient given that there are moving costs & so on, but what would be fairer [to taxpayers] is if mortgage holders were obliged to run down any equity that they have above a certain threshold before getting help.

Can't disagree with that.

Remarkably.