The number of possession orders in the UK has nearly doubled in year but one of the country's biggest lenders has revealed that thousands are taking advantage of low interest rates to overpay their mortgages.
More than 13,000 possession orders were granted in the third quarter of last year, almost double the amount for the same period in 2007, according to the Financial Services Authority (FSA).
Possession orders are when lenders are granted legal control of a property by the courts, but they do not necessarily mean the owner will be evicted. However, the FSA also revealed that the number of householders three months behind with mortgage repayments had reached 340,000, a 24 percent annual jump and ten percent up on the previous quarter.
Adam Sampson, chief executive of housing charity Shelter, said that while the government was helping the country's banks, "it is still seemingly unable to provide adequate support for millions of hard-working homeowners".
However, there was also brighter news on the mortgage front. Lloyds TSB, one of the biggest mortgage providers in the UK, said that 27,000 of its customers had applied to overpay their mortgage following the Bank of England's interest rate cut in November. The lower interest rates mean that people with cash to spare can pay back their mortgage for less.
"For those who can spare the extra money, making overpayments is a smart move," said Stephen Noakes, marketing director at Lloyds's brand Cheltenham & Gloucester. "Not only can it trim years off your mortgage term but, with house prices falling, overpayments will help to protect the equity in your home."
