Arrears and repossessions continued to fall in the second quarter of 2014, according to data published today by the Council of Mortgage Lenders (CML).
The number of mortgages in arrears of 2.5 per cent or more of the balance stood at 131,400, or 1.18 per cent of all mortgages at the end of June.
That’s down from 138,200 (1.24 per cent) three months earlier and 154,900 (1.38 per cent) a year ago.
The overall total is now at its lowest since the first quarter of 2008, according to the CML figures.
A total of 5,400 properties (0.05 per cent of all loans) were repossessed in the second quarter, down from 6,400 in the preceding quarter and 7,600 a year ago.
Jonathan Harris, director of mortgage broker Anderson Harris, says the results are only to be expected, given rock-bottom interest rates, rising employment and lenders’ current tendency to be more flexible.
“‘However, there are still tens of thousands of homeowners being repossessed each year, which begs the question: what will happen when interest rates do 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.”
He adds: “Borrowers must keep their lender in the loop if they are struggling with their mortgage. It is much easier and less stressful to come up with solutions early on than further down the line when the options may be much more limited.’
Buy-to-let figures positive
Arrears and repossessions in the buy-to-let sector also continued to fall.
Buy-to-let mortgages in arrears of three months or more were at 13,400 at the end of June, down from 17,900 a year ago.
In the second quarter, 1,300 buy-to-let properties were taken into possession, compared to 1,400 a year ago.
