....as officials face up to problem of borrowers unable to repay their mortgage

Officials are expected to rule that there has not been widespread mis-selling of interest-only mortgages, according to reports this morning. The Financial Services Authority (FSA) is examining interest-only mortgages as the time approaches when large numbers of the loans sold during the credit boom become due for repayment. The FSA is due to report back in the first quarter of this year. According to the Times, the watchdog is looking at the need for action to deal with the problem of borrowers who reach the end of their mortgage term with no way of repaying the full loan amount. Property data provider Xit2 has estimated that as much as £116billion will be owed to lenders over the next eight years by borrowers that have no means to repay their mortgage, creating a huge surge in repossessions....Read more here