Northern Rock Sees £1.4bn Loss and Jump in Repossessions

by Peter Wakeford
Posted by Hannah on 3 March 2009
Northern Rock Sees £1.4bn Loss and Jump in Repossessions

Government-owned bank Northern Rock recorded a loss of £1.4 billion last year and saw repossessions rise by 63 percent.

Beleaguered bank Northern Rock made "good progress" last year according to its chief executive Gary Hoffman, despite seeing a £1.4 billion loss and a 63 percent jump in repossessions.

According to the nationalised company's report for the year, it had a success in terms of its mortgage redemption scheme - which involved cutting the number of mortgages it had - which allowed it to reduce its loan from the government to £8.9 billion. The figure had stood at £26.9 billion at the end of 2007.

The number of unsold repossessed properties on its books reached 3,620 as 2008 came to a close, compared with just 2,215 at the end of 2007. However, this was less than the 4,201 recorded on September 30th 2008.

Northern Rock is now seeking to boost its mortgage lending, in line with government plans to help potential homeowners and boost the ailing property market. It lent just £2.9 billion in home purchase loans last year, compared with £29.5 billion in 2007.

"Our return to the mortgage market will be governed by focussing on responsible lending, understanding our customers' needs, and offering them great products and service," said Mr Hoffman. "These qualities lie at the heart of the future success of Northern Rock."

Get our free money saving newsletter
Join over 480,000 other subscribers who grab our expert money tips, unmissable money guides & hottest bargains each week in our special email...
Terms & Conditions
 
3

Your Comments

Steve White
on 6 Mar 2009 10:17
I have a mortgage with Northern Rock, the fixed rate deal finished in sept 08 and went to the Standard Variable Rate of 7.49% which was 2.49% over the Bank of Englands base rate. The base rate has now dropped to an incredible 0.5%, but the Northern Rock's SVR is 4.79%, a difference of 3.79%, why are they not handing down this decrease accordingly? Surely they should be setting an example to other banks especially considering it is owned by the Government. Repossessions are up, no help for those people, why not cut their rate to the base rate for a while and help them out? Existing customers, like myself, are not being offered a re-mortgage but instead being told to look elsewhere. Why is this? well the government just wants its money back asap, they don't seem to care about the likes of you and me or how their actons are causing misery to the thousands that are having their homes repossessed. Northern Rock pull up your socks.
 
Claire Poutney
on 5 Mar 2009 22:18
Can a bank really be prepaired to lend yet more money for mortgages, what about helping the people who they are trying to repossess? Would that not be more beneficial than letting those people become homeless and let those properties go into disrepair! There is a moral issue here too which is not just balancing the accounts. These are real people who need real help, not a kick in the teath by losing their homes too
 
Richard Shaw
on 3 Mar 2009 23:16
I have an existing mortgage with northern rock which I am happy with but with times geting tough I am looking to downsize and get something smaller to reduce monthly outgoings but to do this I need a 90% mortgage which I believe N R are not offering, because I have a payback clause with mortgage I am unable to switch to another lender so I see no way of geting out of the position that I am in. We are always advised to take action before it gets to bad, this I am trying to do but it seems one of that I am in a no win situation.