Mortgages

Mortgage arrears fall 8% to new record low: UK Finance

Mortgage arrears and possessions continue to remain at historic lows, according to the latest UK Finance data for the second quarter of 2018.

Rozi Jones
|
9th August 2018
house sale buyer mortgage arrears
"Arrears and possessions are at an all-time historic low since we first started collecting this data over 24 years ago."

Mortgage arrears and possessions continue to remain at historic lows, according to the latest UK Finance data for the second quarter of 2018.

It shows that there were 76,740 homeowner mortgages in arrears of 2.5% or more of the outstanding balance in Q2, 8% fewer than in the same quarter of the previous year.

Within that total, there were 23,190 homeowner mortgages with arrears representing 10% or more of the outstanding balance, a 4% annual drop.

There were 4,440 buy-to-let mortgages in arrears of 2.5% or more, 6% fewer than in the same quarter of the previous year.

However there were 1,080 buy-to-let mortgages with arrears of 10% or more, 2% greater than in the same quarter of the previous year.

1,060 homeowner mortgaged properties were taken into possession in the quarter, representing a 5% drop, while the number of buy-to-let possessions fell 24% to 520.

Jackie Bennett, director of mortgages at UK Finance, commented: “Arrears and possessions are at an all-time historic low since we first started collecting this data over 24 years ago.

“While this is positive, last week's base rate rise coupled with the disappointing uptake of the Support for Mortgage Interest (SMI) loan could see arrears creeping up in the coming months.

“With well over 90% of new loans taken out at fixed rates, most recent borrowers will see no immediate impact from the Bank rate increase. However, anyone with concerns about managing their mortgage should contact their lender to discuss the advice and support available. Repossession is always a last resort.”

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