One in five Britons paralysed by mortgage repayment fears

It fears repossessions will keep on rising this year to nearly 125 a day. Philippa Gee, investments director of the financial advisers Torquil Clark, said: “The real problem is how many people will be unable to make payments due and end up facing bankruptcy and having their homes repossessed. “This is tragic. More and more borrowers will be in this disastrous position over the next 12 months.

It is a bleak picture.” Financial advisers suggest people should always store up at least three mortgage repayments to use in an emergency. In reality, few can afford to follow such sensible advice. The FSA is launching a 2million advertising campaign to help people find a mortgage which they can afford. It urged people who are struggling not to panic but to talk to their lender or get help from a free debt advice firm.

The number of people who have fallen behind with their mortgages is already around 130,000, its highest level since 2002. Ed Stansfield, property economist at Capital Economics, said: “With the economy set to slow sharply, unemployment likely to rise and mortgage lenders still tightening lending criteria, higher repossessions this year seem likely.” The FSA’s report was based on interviews with 2,011 adults in the middle of February. Of this number, 573 had mortgages.