Home repossessions soar by 17% to near 1990s peak... but the worst is yet to come

The number of families who risk losing their homes has more than trebled in parts of the country over the past year.

Official figures reveal the devastating impact of the supersize mortgages taken out during the housing boom.

Between January and March, a staggering 27,530 families - or 300 every day - reached the brink of being homeless.

This is the number of "possession orders" issued by county courts in England and Wales, the final legal step before repossession.

Overall, the number of these orders between January and March is more than 17 per cent higher than the same period last year.

But in certain areas the picture is much more grave. The biggest casualty is the town of Haverfordwest, Pembrokeshire, in Wales, where numbers have jumped 248 per cent.

Skegness, Scarborough, Skipton, Lancaster, Salisbury and Mold, Flintshire have all been hit by rises of more than 80 per cent.

And some of the richest parts of England are being hit nearly as badly. Numbers of possession claims are rising more sharply than the national average in counties such as Gloucestershire, Suffolk and Sussex.

Debt advice charities warned yesterday that they are being flooded with calls from homeowners in crisis.

The figures, published by the Ministry of Justice, are a stark illustration of the dramatic impact of the credit crunch.

They show how the combination of rising mortgage payments and inflation-busting household bills is paralysing family finances.

Possession orders, dubbed "the last chance saloon", are at their highest level since the last property crash in the early 1990s.

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And experts warn that the number, which has already trebled since 2003, will climb even higher this year.

Howard Archer, chief UK economist at the consultancy Global Insight, said: "Unfortunately the situation seems set to deteriorate significantly further."

A spokesman for the charity Shelter, said: "Mortgage lenders should be helping homeowners to stay in their homes, but with some, it is a case of miss a couple of payments and you'll find yourself in court.

"People are sinking in a sea of debt and sadly under the pressure they are losing their homes."

The Joseph Rowntree Foundation said families see the threat of losing their home as the ultimate blow. It can lead to depression, divorce and an agonising disruption on children's lives.

Yesterday's figures do not represent actual repossessions, but rather those who will lose their homes if they cannot find money or strike a deal with their lender.

Even after a county court has made a possession order, a family can still negotiate a deal to stop repossession.

Last year, for example, there were 95,187 orders but only 27,100 repossessions. The Council of Mortgage Lenders predicts there will be 45,000 repossessions this year.

Vince Cable, Liberal Democrat Treasury spokesman, said: "The Prime Minister's pride and stubbornness has made him completely unwilling to recognise the dangers in the housing market. It is overstretched households that will pay the price."

There is no set time period that it takes for a home to be repossessed.

But a typical example would involve a family falling three months behind with their mortgage, prompting their bank or building society to issue a claim.

If the family cannot meet the claim, they are taken to the county court and an order is made for possession. If the situation is not resolved, they lose their home.

Lenders insist they do everything possible to prevent repossession, but urge owners to get in touch to talk about financial problems, rather than bury their heads in the sand.

Michael Coogan, the Council of Mortgage Lenders' director-general, said: "No one wants to see repossessions rise. But risk is a part of life, and for some households circumstances change and they cannot get back on their feet."

Yesterday a £10million Government package aimed at helping homeowners in trouble was dismissed as "too little, too late" by the Tories.

The money will be spent on free legal help for those facing repossession and extra money to train debt charity staff.