UK mortgage arrears fall, repossessions rise

UK Finance is a trade association that represents the banking and finance industry.  It has recently released the latest arrears and repossession figures for the end of 2024.  A summary of what has happened in the quarter.

Arrears

According to the latest figures for the 4th Quarter of 2024, the number of homeowner mortgage loans in arrears has fallen by 2% compared to the 3rd Quarter.  In a slightly better position are Buy to Let mortgages which have seen arrears fall by 3%.

The overall number in arrears is still low though.  Around 1.06% of all homeowner mortgages are in arrears and 0.65% of buy-to-let mortgages.

There is one particular area that has increased.  Homeowner mortgages that are in arrears of 10% or more of the mortgage balance have increased by 9%.

Repossessions

Not so good news here.  In Quarter 4 2024 there were 1,030 homeowner mortgage properties repossessed.  This is a 12% increase on the previous quarter.  But it also represented a 54% increase on the same quarter in 2023.

700 Buy-to-Let properties were repossessed which is fairly static on the previous quarter but 30% greater than Quarter 4 2023.

The main cause being reported is higher interest rates often coupled with the increased cost of living.  Many households have struggled in the last couple of years and I have read many heartbreaking stories of families struggling for many, many years but not being able to cope financially due to events of the last couple of years.