It is difficult to escape the doom and gloom that surrounds the mortgage market in the United Kingdom. Falling house prices may be a welcome sound to first time buyers however not so for the millions of homeowners throughout the country. It is not just falling house prices which has hit the news in recent months but also of the ongoing credit crunch crisis which continues to cause havoc across the world - and in particular, the finance and mortgage markets.

This is bad news for borrowers looking to remortage as many attractive special offer fixed rates come to an end. The cost of borrowing has gone up compared with just a couple of years ago and in particular the cost of remortgaging as many lender's are increasing their arrangement fees so as to keep their rates looking as attractive as possible.

The fear resounding within the mortgage industry is that the situation is set to worsen and many are even starting to draw parallels to how the situation was like back in the early nineties - repossession orders in the UK are set to hit a record high. Whoever you listen to however, one fact is inescapable; property repossessions are set to sky-rocket in 2008. Britain's Financial watchdog the Financial Services Authority (FSA) have already confirmed as much in a recent bleak report confirming that as many as one million families could be set to loose their homes. It isn't just the increase in monthly mortgage or secured loan repayments that will put a strain on the household finances but also of the increase in utility bills.

Playing the repossession blame game would see the spotlight firmly shining on mortgage lenders and brokers alike. The Financial Services Authority has made sweeping changes with respect to ‘Responsible Lending' since they were appointed as Britain's Financial watchdog in October of 2004. In particular, there has been a major concern that when assessing a borrowers affordability in respect of their mortgage/remortgage application. more care should be taken when determining whether it is affordable not only during any special offer fixed or discounted rate but also whether it is affordable after that period of time when the repayments are set to potentially increase.

The recent credit crunch crisis which continues to engulf the globe has not helped matters anyhow. For a long time many first time buyers have been prepared to take on huge mortgages so as to get their foot on the property ladder however many are fearing that such loans are quite simply not going to be affordable in interest rates increase much more. Likewise their has been a culture prevalent for homeowners to borrow money against their property in order to consolidate existing debts and to carry out home improvements which has also left them very exposed to interest rate movements due to their larger liabilities.