Call to help struggling East Lancashire homeowners in negative equity (From Lancashire Telegraph)

Call to help struggling East Lancashire homeowners in negative equity

4:50pm Wednesday 4th July 2012 in News By Bill Jacobs , Local government reporter

HYNDBURN MP Graham Jones has demanded more help for East Lancashire home owners whose mortgage is bigger than the current value of their property.

He has asked junior housing minister Andrew Stunnell in the House of Commons: “What assessment have the government made of the level of negative equity in the north of England?”

Mr Stunell replied: “A Council of Mortgage Lenders report in 2011 suggests that, as of the first quarter of that year, 827,000 UK households were in negative equity. That includes nearly 300,000 in the north of England. The organisation also reported that there were 36,200 repossessions that year — the lowest annual total since 2007.”

Labour backbencher Mr Jones then asked Mr Stunnell: “In its report on home ownership, Standard & Poor’s says that rates of negative equity in the North West and the North East are four times higher than those in London.

“Obviously those areas were disproportionately hit by the Government’s cuts, and unemployment is rising.

“There are hard-pressed families in these regions struggling to pay their mortgages.

“What help is the Minister going to give them?”

Liberal Democrat Mr Stunell said: ”I remind you that negative equity becomes a problem if people cannot pay their mortgage. Mortgages are affordable at the moment because of the fiscal and financial policies that this coalition Government are pursuing.

“ Interest payments on mortgages are at the lowest level as a pro-portion of total income since records began.

“I invite him to consider how many repossessions in the north of England would result if we had the bond rates of the Italians or the Spanish, and therefore how important it is for this Government to remain steadfast on their fiscal programme.”