One Million Families Could Be Homeless

The FSA fears that huge mortgages and other debts could put one million families in the UK at risk of losing their home over the next 18 months. Huge mortgage debts along with other debts such as store cards, credit cards and loans will combine to force many families over the edge. As many fixed-rate mortgages come to an end many families may find they cannot move to another cheap deal and will be left struggling with repayments.

It forecast that nearly 20% of families who took out a mortgage between April 2005 and September 2007 are at risk of having their home repossessed. This accounts for 1.04 million families who have taken out their first mortgage or remortgaged to a better deal.

These families are identified by having 2 or more of the three identifying factors:
- paying less than a 10% deposit
- mortgaging for longer than 25 years
- borrowing more than 3.5 times annual salary

150,000 families have all 3 factors and the FSA are particularly worried about these, having taken out the mortgage at a time when property prices were soaring.

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