Evidence submission (Personal Narrative): Home owners in mortgage debt

Rising repossessions due to mortgage debt are forecast this year by the Council of Mortgage Lenders. After a fall in the number of arrears and possessions the rise is anticipated due to poor market conditions, mortgage borrowers exhausting lenders forbearance procedures and because of a weakening in state support to defaulting borrowers (through reductions in payments and withdrawal of Support for Mortgage Interest and limited access now to the Mortgage Rescue Scheme). Higher interest rates are a major concern that could tip many borrowers into arrears and those already struggling into possession.

There are health impacts of mortgage repossessions on borrowers, evidenced qualitatively in Sarah Nettleton’s work (1) and more recently quantitatively in the work of Pevalin (2).

In addition, the number of possessions and arrears represent only a portion of households affected as the Survey of English Housing reports just over a million households struggling with their mortgage payments 2007/8 and it is very plausible that as the recession took hold that this figure will now be higher.

I have studied various aspects of the management of mortgage arrears and possessions since 2008 and more recently, anecdotally, debt advisers do report enormous pressures from struggling with arrears on a person’s mental health. Just this week an adviser reported to me a phenomena of people expressing suicidal thoughts to her which she had not experienced before (three in one day last week). The strain and psychological impacts of loss of status, the anxieties of managing debts with limited support (compared to tenants) may warrant further examination. Danny Dorling reports in Bankrupt Britain about the prescribing rates of anti-depressants in UK being concentrated in northern areas where the downturn had hit hardest and it would be of interest to examine the relationship between this and mortgage debts and arrears as well as job loss etc.

(1) Nettleton, S., Burrows, R., (2000) When a Capital Investment Becomes an Emotional Loss: The Health Consequences of the Experience of Mortgage Possession in England, Housing Studies 15 (3): 463-479

(2) Pevalin, D (2009) Housing repossessions, evictions and common mental illness in the UK: results from a household panel study J Epidemiol Community Health 63:949-951

Evidence Submission by: Alison Wallace, Academic Researcher