People seeking municipal help amid housing repossession fears double

“I’m waiting for the sheriff to knock on the door, take my keys and throw me out,” says José Da Costa Diogo, one of thousands of people who have been told this year that their homes will be foreclosed.

The 65-year-old learned he would lose his home in Thetford, Norfolk, during a fiery 10-minute hearing at the county court earlier this year.

The interest-only mortgage on the three-bedroom property was taken out more than 20 years ago in the hope that he and his then-wife would save enough to eventually cover the capital sum.

But the collapse of the marriage and his ex-wife’s departure to Brazil in 2015 left Da Costa Diogo unable to pay the £80,000 still outstanding.

And since his ex-wife was still listed on both the mortgage documents and the property titles, he was also unable to sell the property to cover the outstanding amount.

“I tried to do the right thing and kept paying all the bills,” he said. “After 25 years, I have nothing to show… but I still have to keep living.

“I’m going to be homeless.”

Court figures show the number of mortgage recovery orders in England and Wales reached 10,853 in 2024-25, the highest figure for five years.

Experts say the increase is due to a variety of factors, including interest rate increases and rising overall costs of living.

Mr Da Costa Diogo registered as homeless with Breckland Council, his local authority.

He is far from alone.

The BBC asked all English housing councils how many people were experiencing homelessness as a result of a mortgage repossession.

The number has doubled, according to the 240 councils that provided comparable data: from 1,517 in 2022-23 to 2,370 in 2023-24.

There were 3,406 in the most recent year.

Local government people say rehousing those affected by foreclosures is putting increasing pressure on council resources.

Tom Hunt, who chairs the Local Government Association’s Inclusive Growth Board, said: “As more and more people turn to their advice for help, local authorities are having to stretch budgets even further.

“The temporary accommodation crisis facing local councils is only getting worse.”

Lucy Davies sees the devastation that repossessions can cause every day.

A housing law adviser at Suffolk Law Centre, she offers her expertise to those who need it in the courts of Suffolk and Essex.

“I see the huge number of people this is affecting,” Ms Davies said.

“People get into trouble largely through no fault of their own.

“Very often there are mental health problems, work problems, family problems, and I think they can very quickly get out of control.”

On the day the BBC joined Ms Davies for a day at Ipswich County Court, where she volunteers with the Ipswich County Judicial Advice and Representation Service, none of the five people facing mortgage recovery cases turned up.

This, he said, was often a symptom of shame, despair and the feeling that losing one’s home was a foregone conclusion.

“It’s pretty scary to go to court, but it doesn’t have to be.”

He urged people to seek advice as soon as possible and said the cases he was seeing were becoming “more deep-seated or more serious”.

People are finding it increasingly difficult to access legal assistance regarding housing, he explained.

Paul Gorton, of The Law Society’s housing rights committee, agreed.

He said a historic lack of investment in legal aid meant fewer and fewer law firms were able to offer housing legal advice.

“Many people are too well off to qualify for legal aid, but they cannot afford to pay for legal advice themselves,” Mr Gorton said.

“We have both a shortage of legal aid providers and restrictive eligibility criteria that leave many people stuck in limbo.”

A Ministry of Justice spokesperson said it had recently announced “the first major increase in funding for housing legal aid in three decades – a 24% increase”.

“This investment will help ensure effective access to justice for some of the most vulnerable in our society, while supporting a more stable and sustainable legal aid sector,” the spokesperson said.

Trying to repossess a home is “always a last resort” for lenders, said Karina Hutchins, director of the mortgage policy team at UK Finance, a trade association for the banking and financial services sector.

He said that while the number of mortgage foreclosures had been increasing in recent years, current levels remained “historically low.”

“Recoveries are really rare.”

He said that in the first quarter of 2025, about 2,000 homes were repossessed compared to 13,000 in the same quarter of 2009, in the wake of the 2008 financial crisis.

“I can imagine customers being really worried and distressed if they face financial difficulties, but they don’t have to go through it alone,” Ms Hutchins said.

“The sooner they contact their mortgage lender, the more support and help that lender will be able to provide them and the more likely they will be to get back on track with their mortgage.”

Options offered by lenders, he said, included reduced mortgage payments to allow time to get back on track, budgeting and other tools to understand “your full financial situation” and advice on debt charities and support organisations.

Henry Sabati McRae, who lives in Croydon, south London, has so far managed to avoid recovery.

A software developer by training, McRae’s financial problems followed the deaths of a brother in 2020 and his mother in October 2023.

Since October 2024, the 51-year-old has been out of work and, despite having applied for hundreds of jobs, he has not been able to get a new contract.

“It doesn’t matter how much you have saved,” he said.

“Within a few months it was gone. I managed to stretch it out as much as I could, because I had been quite conservative with the way I acted.”

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Even so, the mortgage arrears on his two-bedroom flat eventually rose to around £13,000 and his bank said that if that figure was not reduced to less than £8,000 it would try to repossess his house.

“The most important thing for me at that time, and I think for anyone, was to keep a roof over my head,” he said. “Otherwise, everything gets out of control.”

To survive, he has resorted to selling his possessions on an Internet auction site and accepting a loan from a friend.

Like many of those facing recovery actions the BBC has spoken to, McRae said the experience was deeply “humiliating” and her instincts initially were to “close the curtains”.

However, he said realizing he was not alone and talking about it helped him map out, as if it were an IT problem, his “solution.”

Businessman Mike Williams, who lives 10 miles south of McRae in Caterham, Surrey, has also avoided recovery.

He assumed the mortgage on the house he built himself after he and his wife separated.

In three years, repayments on the interest-only loan, which was taken out 20 years ago, have tripled.

He says this has left him with “almost no disposable income.”

In court, he renegotiated a payment plan that would add an additional 20% to his monthly payments.

In five years, when the mortgage comes to an end, he intends to sell the two-bedroom house he and his wife built from scratch.

“It has quite a bit of sentimental value to me, so yeah, it’s heartbreaking,” he said.

As for Mr. Da Costa Diogo, his bank has seized the property.

The same month it was repossessed, the BBC saw a similar three-bedroom property on the same Thetford street as Mr Da Costa Diogo’s on the market for £160,000, almost double the amount he owed.

Within hours of losing his home, he was given emergency accommodation in a small ground floor studio apartment in north Suffolk.

“I left my house with a suitcase and a bag with essentials and told the city council: ‘I have no home.’

“It’s a roof over my head. I’m trying to keep things simple because what’s the point of complicating things?

“I’m alive and moving forward.”

With additional reporting by Zoe Dennis and Stephen Menon