In that period, the rate was 0.02% - equivalent to just 1 in 5,000 mortgages. Arrears also continued to fall.
There were 2,500 properties taken into possession in the second quarter, down from 3,000 the previous quarter and 5,400 in the second quarter of last year. Of these, 1,800 were in the owner-occupier market, and 700 in the buy-to-let market. However, as in the first quarter, the current flow of repossessions probably continues to remain lower than the underlying trend would imply, even though arrears are also falling.
In terms of arrears, the total number of mortgages with arrears equivalent to 2.5% or more of the mortgage balance was 106,400.This equated to 0.96% of all mortgages - again, the lowest rate since quarterly records began in 2008.
Separate figures released today by the Finance & Leasing Association also that the number of second charge mortgage repossessions fell 49.6% in Q2 2015, compared with the same period last year.
CML director general, Paul Smee, said:
"Across all measures, mortgage arrears and repossessions are continuing to improve. We continue to see some amplification of the downward trend in repossessions, which may bring into question our repossessions forecast for 2015 as a whole.
"This trend is very welcome. Low interest rates are acting as a significant support for home-owners in general, and are likely to be helping to stave off low level arrears for stretched households in particular. As ever, we urge borrowers to think ahead to when interest rates rise, and to contact their lender without delay if they are in difficulty - prompt action helps to prevent problems worsening."
Fiona Hoyle, Head of Consumer Finance at the FLA, said:
“The further decrease in repossessions reflects second charge mortgage lenders’ commitment to helping customers in financial difficulty.”
Brian Murphy, Head of Lending at Mortgage Advice Bureau, commented:
“A record low for repossessions and the falling number of loans in arrears have been two of the big success stories for mortgage borrowers in the post-recession era. Both measures continue to show signs of considerable improvement, and consumers are clearly finding it easier to keep their personal finances from slipping away from their control.
“The record low base rate has played a big party in helping households keep their loan commitments in check. The prospect of a higher base rate is clearly the biggest single factor that threatens this progress, but rate rises will be slow and steady – giving consumers plenty of time to adjust. The tightening of loan criteria following the Mortgage Market Review will also help keep things on a stable footing moving forward.
“Reactions to yesterday’s unemployment figures show the timing of the first rise remains a moving target, but homeowners should still take the chance to safety-proof their finances well in advance. Locking into the current rates before the winds change is likely to prove a wise move, and there has seldom been a better time to seek a well-priced remortgage deal.”
