MORTGAGE ARREARS AND REPOSSESSIONS IN SCOTLAND
Footnotes
1 "Repossession" is not strictly the correct term since properties have not previously been in the possession of lenders; however "repossession", rather than "possession", is the term in common usage and is used throughout this report.
2 Presumably due to moves to larger properties with increased borrowing.
3 Although two or three children are more expensive than one, first babies have more of an impact on the household as they typically result in the first experience of the loss of income of one partner.
4 The source of this information is http://www.mortgagecode.org.uk/mortgagecode.html .
5 Section 24 is the part of the Conveyancing and Feudal Reform Scotland Act (1970) which is normally used. However, if only ejection is sought, and a calling-up notice has been used first, then section 20 may be used.
6 This figure has been calculated based on JRF published research (1995) on, inter alia, suspended repossession orders in England and Wales, which concluded that 75% of defaulters who obtained a suspension of the order got back on their feet. The Lord Chancellor Department's returns set out the number of repossession orders applied for and the numbers suspended. The arithmetic is that approximately 60% of repossession orders in England and Wales are suspended, and 75% of 60 is 45%.
7 The Land Register of Scotland (progressively superseding the Sasines Register) contains title information on all properties in Scotland. The information includes ownership details, a description of the property (either written or by reference to a plan), the price paid and any outstanding securities (mortgages) which affect the property. Information is recorded by solicitors on whether or not the property was repossessed but this is not entered into the land register at present. Nevertheless, this source was useful in identifying a comprehensive list of lenders in Scotland for the postal survey of lenders.
8 No cases in the data collection were found recorded under this act.
9 It is certain that some cases of repossession of commercial properties remain in the data, as a number of people contacted to be interviewed phoned in to say it was their shop or business premises which was repossessed and not their home.
10 There were only 6 cases where the case was recorded as one where the defender carried out their own defence (0.2%).
11 Associate members are non-lending institutions that have an interest in the housing market but are not active lenders so do not form part of the survey sample. Active lenders who have been lending for less than one year are also associates but are also Mortgage Code Compliance Board (MCCB) registered.
12 ( http://www.cml.org.uk/xls/2000top30.xls )
13 This is the number of recorded standard securities in 2000 from the Register of Sasines which is unlikely to correspond to outstanding stock.
14 Centralised lenders were those who either operated through call-centres or the internet and did not have a branch network or intermediaries.
15 This figure has been calculated by summing the loans given by each lender. It is not weighted or grossed up. Seven lenders did not supply this information and so this is based on information from 26 lenders, that represent 64.7% of the market according to the Register of Sasines.
16 This figure has been calculated by summing the loans given by each lender. The figure is not weighted or grossed up. Three lenders did not supply this information and so this is the sum of loans for 30 lenders, which represent 72.5% of the market according to the Register of Sasines.
17 http://www.scotland.gov.uk/stats/bulletins/00130-00.asp
18 Table 2., http://www.scotland.gov.uk/stats/bulletins/00115/00115d-53.asp
19 Four lenders did not provide this information.
20 Two lenders did not provide this information.
21 These figures are an average of all the percentages given by lenders and so do not sum to 100.
22 This is the weighted mean of answers to the question 'Of the properties taken into possession in 1999 (Jan - Dec) in Scotland, how many, as far as you are aware, were purchased through the Right to Buy system?'. This has been weighted by number of repossessions in 1999.
23 http://www.scotland.gov.uk/library/documents-w1/seb57-13.htm (Hamilton, J & Mackenzie, K (1998) The Housing Market in Scotland, Scottish Economic Bulletin, Number 57. ISBN 0 11 495902 1 The Scottish Office
24 This is based on only 6 cases.
25 In this instance re-mortgage refers to leaving one lender and moving the principal loan on the property to a new lender. It does not refer to someone taking a further advance with the same lender.
26 White Data is information that is held by the credit reference agencies. A white data credit reference search would look at mortgage payment histories, credit card histories, hire purchase histories, etc. ie debt payment history. The catch for the companies using white data is, if they sell a product that uses a white data credit reference search they are required to thereafter supply white data about loan repayment history on that product, so it requires technology investment for a company to automate this process.
27 Black Data is anything that is available to the public ie, court records, voters' role.
28 The Building Society commission has rules about when arrears can be capitalised. Loans must be 'performing' for a certain period so that the true extent of risk is clear and the borrowers have been shown to be truly back on track.
29 Seven of the ten lenders obtained either 2 or 3 valuations.
30 Three of the ten lenders obtained only one valuation.
31 This particularly refers to debt advisors and CAB staff who contacted potential interviewees for us. We were unable to 'sell' the research directly to the potential interviewee and were unable to chase up respondents who agreed to contact us and then didn't.
32 There were two people who bought under RTB who were not first-time buyers. An illustration of how this could occur is that one of our interviewees owned his own home, then sold it. Then moved in with a female council tenant. They bought this property together under RTB.
33 This figure although low is valid. This refers to a case where an interviewee bought a ruined property, and borrowed large sums to renovate it.
34 Formal advice is from a broker, lender, solicitor or estate agent and so on. Informal advice sources refer to friends, family or colleagues.
35 The sample varied from year to year and represented 71.5% of market share in 1999 and 72.5% in 2000. The sample base is different between 1999 and 2000.
36 The usefulness of valuations and surveys is being fully covered by another Scottish Executive research project.