The Council of Mortgage Lenders (CML) have found that the total number of homes that were repossessed in 2011 has dropped to only 36,200 – the lowest total annual value since 2007 – which is lower than their original forecast of 40,000.

It would appear that low levels of interest and forbearance by lenders may be the reasons why these numbers have been kept down, but CML also feel that this will not last. With unemployment set to rise in 2012, they feel that this will push back up the levels of repossessions in the UK.

The annual total for 2011 was only slightly down from the 2010 total – from 37,100 homes being repossessed to 36,200.

The data collected shows that the final three months of the year saw a total of 8,500 homes being repossessed, which is 9% lower than the previous quarter but also 5% from the same month in 2010.

The CML have stated that the information shows that the number of people falling into arrears on mortgage payments improved slightly on a year earlier with a 7.5% decrease in the number from the end of 2010.

Despite this improvement, by the end of 2011 159,400 mortgages had arrears equivalent to 2.5% or more of the whole mortgage balance.

Even with home sales forecast to hit a record low in the coming year – CML have said that the chances of people losing their homes will see an increase throughout 2012.

Director General of CML, Paul Smee had this to say: “Low interest rates and good arrears management by lenders are helping the vast majority of those borrowers who face difficulties to keep their homes and get back on track,

“This will continue, but in the face of wider economic difficulties and rising unemployment, we are concerned that there will be a higher number of people facing more serious problems in 2012.

“Anyone worried about their finances should talk to their mortgage lender and take advice on their other debts as soon as possible. This will give them the best possible chance of staying in their home even if they have a spell of financial difficulty.”

Along with this data, CML have announced their forecast for repossessions in the coming year, with their estimate reaching 45,000 in 2012. This is a very low peak compared to that of 1991 where it reached 75,500.

In 2011, 0.42% of all mortgaged buy-to-let properties found themselves being repossessed – a total of 5,900. This is a larger percentage compared to the 36,200 (0.32%) owner-occupied homes that were repossessed in the same time period.

This shows that despite arrears being lower on buy-to-let mortgages compared to personal mortgages on properties, the repossession rate in the sector is in fact higher.