More than 1m people could lose homes in credit crunch, warns City watchdog

Evening Standard | Jan. 30, 2008

More than 1million families are in danger of losing their home over the next 18 months, Britain's financial regulator warned yesterday.

It fears that huge mortgages and other debts will prove a lethal cocktail during the global credit crunch.

As banks become more wary, many coming out of a fixed-rate term on their home loan will find they cannot switch to another cheap deal.

Even the smallest increase in bills or repayments will tip some over the edge, according to the Financial Services Authority (FSA).

In the bleak forecast, it said that nearly one-fifth of those who took out a mortgage between April 2005 and September 2007 risk having their property repossessed.

This group of 1million includes those who took out their first home loan, and those who remortgaged from one deal to another.

Full article here