Repossessions remain low despite slight rise
The number of mortgages in arrears fell in the first quarter of 2025, according to new figures from UK Finance, as lenders continue efforts to support borrowers facing financial strain.
A total of 90,140 homeowner mortgages were in arrears at the end of March, a 2% drop compared with the previous quarter. Buy-to-let mortgages in arrears also declined, falling 6% to 11,830.
Overall arrears rates remain historically low, with just 1.03% of homeowner and 0.61% of BTL mortgages in arrears. For context, during the 2009 peak of the global financial crisis, 209,600 homeowner and BTL loans were in arrears.
Early-stage arrears also fell during the quarter, suggesting any future rise in arrears may be limited.
“The number of mortgages in arrears fell slightly compared to the previous quarter and the arrears numbers appear to now be on a downward trend,” said Charles Roe (pictured left), director of mortgages at UK Finance. “The recent cuts in interest rates and mortgage rates will also help households with their monthly bills.”
UK Finance’s latest mortgage arrears and possessions data also revealed that there were 2,030 repossessions of mortgaged homes and rental properties in Q1 2025, a slight increase on the previous quarter. However, this figure is still 85% lower than the 13,200 recorded in the same quarter of 2009.
Toby Leek (pictured right), president of NAEA Propertymark, welcomed the reduction in arrears but expressed concern about the increase in repossessions.
“It’s extremely positive to see mortgage arrears drop to their lowest level since 2009,” he said. “There has been much progress within the sector to help ensure the overall lending criteria is more robust and offers consumers a higher degree of safety regarding their affordability.
“However, it is concerning to see repossessions witness an increase within the first quarter of 2025, as it demonstrates there is still an aftershock regarding the recent surge in the cost of living and support available to those who may need genuine help in the short to medium term.”
Most repossessions, UK Finance noted, involved mortgages originated at least 10 years ago. According to the trade body, these typically relate to longstanding cases where lenders have worked through all other options before proceeding with possession. UK Finance stressed that early communication with lenders is key, and that seeking help does not affect a borrower’s credit score.
“Lenders are committed to supporting anyone facing financial difficulties and offer a range of tailored solutions,” Roe said. “If you’re worried about your finances, please reach out to your lender as soon as possible to discuss the help available.”
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