Mortgage problems 'on the rise'

New figures have shown that the number of repossessions and mortgages in arrears of more than three months are on the rise.

The Council of Mortgage Lenders (CML) has disclosed that the proportion of mortgages ending in repossession has risen in the first half of this year from 0.11 per cent to 0.16 per cent.

In addition to this, the number of mortgages in three months or more of arrears rose to 155,600 in the first quarter of this year, compared with 129,600 at the end of 2007.

By the end of the year the number of repossessions will have hit 45,000 and the total of mortgages in serious arrears will be 170,000, the body predicted.

Such figures may persuade some to opt for self build to save money rather than taking on a mortgage they may struggle to pay.

Earlier this week Sue Edwards, the head of consumer policy at Citizens Advice, urged lenders to only use repossession as "a last resort".