Lowest Number of Mortgage Arrears for Over a Decade

Last year, the lowest number of mortgage arrears for over ten years was recorded, according to the Council of Mortgage Lenders (CML).

Less than one in 1,000 mortgages ended in repossession in 2015, and less than one in 100 mortgages were in arrears.

Lowest Number of Mortgage Arrears for Over a Decade

Lowest Number of Mortgage Arrears for Over a Decade

The quarterly report from CML found that homeowner mortgage arrears accounted for 1.03% of all loans at the end of the year, while buy-to-let arrears were at a lower rate of 0.31%.

However, lenders are more likely to repossess buy-to-let properties than owner-occupier homes, with about one repossession per 2,500 mortgages in the buy-to-let sector in the fourth quarter of 2015, compared to one in 5,000 in the owner-occupier market.

The total amount of repossessions in 2015, at 10,200, was less than half the number recorded in 2014, at 20,900.

But the CML has warned that the annual comparison should be recorded with caution, due to the timing of some possessions following a court case that has led to lenders reviewing their processes.

The case in question was Bank of Scotland v Rea, which regarded how the interest on fees charged on some loans in arrears are calculated.

After the case, some lenders halted repossession proceedings while they considered the implications of the outcome.

The postponed cases are likely to restart this year.

Separate data from the Ministry of Justice also reveals the latest mortgage and landlord possession statistics for England and Wales, covering the last quarter of 2015.

Between October and December, there were 36,601 landlord possession claims in the county courts. The majority (62%) were claims by social landlords. Additionally, there were 9,775 repossessions by county court bailiffs.

The Department for Communities and Local Government has released updated guidance on obtaining possession on a rental property. Find it here: https://www.gov.uk/guidance/gaining-possession-of-a-privately-rented-property-let-on-an-assured-shorthold-tenancy

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