"This month's interest rate cut should provide further relief to those on variable rates, assuming lenders pass the reduction on in full."
At the end of June there were 92,500 mortgages in arrears of at least 2.5% of the balance (0.84% of the total), down from 95,900 at the end of March and 13.4% lower than a year ago.
The number of properties taken into possession also fell in the second quarter, to 1,900 (down from 2,100 in the first three months of the year). There was a decline in both the numbers of owner-occupied (1,300, down from 1,500) and buy-to-let (500, down from 700) properties taken into possession.
The CML says that if the present trend continues, the number of mortgaged property repossessions this year is on course to be the lowest since 1982 (when there were 6.5 million mortgages, compared to 11.1 million today).
Jonathan Harris, director of mortgage broker Anderson Harris, said: "This reflects rock-bottom interest rates and improving employment figures, as well as lenders prepared to be flexible and show forbearance. This month's interest rate cut should provide further relief to those on variable rates, assuming lenders pass the reduction on in full.
"However, there is no room for complacency. There are still many homeowners being repossessed or finding themselves in arrears on their mortgage each year, which begs the question: what will happen when interest rates move the other way and start to rise? How will people cope? We suspect that when it comes to their finances there are many people teetering on a knife edge and rate rises could easily push them over."
