The number of homeowner mortgages in arrears fell by 2% in the first quarter of 2025 compared to the previous quarter, according to new figures from UK Finance. Buy-to-let arrears also declined, dropping 6% over the same period.
The overall proportion of mortgages in arrears remains historically low, with 1.03% of homeowner mortgages and 0.61% of buy-to-let loans currently in arrears. In total, there were 90,140 homeowner mortgages and 11,830 BTL mortgages in arrears during the first quarter.
By contrast, at the peak of the global financial crisis in Q1 2009, the combined figure for homeowner and BTL arrears stood at 209,600, highlighting the relative resilience of the mortgage market today.
Although there was a rise in the number of possessions, they remained far below historic norms. A total of 2,030 mortgaged properties were repossessed in Q1 2025, 85% fewer than the 13,200 recorded in the same quarter of 2009.
Possession cases continue to be concentrated among older mortgages, with over two-thirds involving loans arranged more than a decade ago. UK Finance said repossession remains a last resort, used only after all other options to keep the borrower in their home have been exhausted.
Charles Roe, director of mortgages at UK Finance, said: “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. The recent cuts in interest rates and mortgage rates will also help households with their monthly bills.
“This is a positive development, but we recognise that some households may still be struggling. Lenders are committed to supporting anyone facing financial difficulties and offer a range of tailored solutions. If you’re worried about your finances, please reach out to your lender as soon as possible to discuss the help available.”
UK Finance said the number of customers entering early arrears had also fallen during the quarter, suggesting that any rise in total arrears in Q2 could be limited.
