Home repossessions edge up but number of mortgages in arrears falls – UK Finance
The number of homeowner mortgage properties being repossessed increased by 3% in the first three months of 2026, compared with the previous quarter, according to a banking and finance industry body.
Some 1,250 homeowner mortgaged properties were repossessed in the first quarter of 2026, which was also 2% higher than a year earlier, UK Finance said.
The number of repossessions remains significantly below long-term averages, UK Finance said, adding that anyone who is worried about their mortgage payments should contact their lender at the earliest opportunity to discuss the options available.
Meanwhile, 810 buy-to-let (BTL) mortgaged properties were repossessed in the first quarter of 2026, which was 5% higher compared with the previous quarter and a 0% annual change.
The overall proportion of mortgages in arrears remains low, at 0.91% of homeowner mortgages and 0.47% of BTL mortgages, UK Finance said.
Some 79,110 homeowner mortgages were in arrears of 2.5% or more of the outstanding balance in the first quarter of 2026 – 2% fewer than in the previous quarter and a 12% fall compared with the same period a year earlier.
And 8,960 buy-to-let mortgages were in arrears of 2.5% or more of the outstanding balance in the first quarter of 2026, which was 6% fewer than in the previous quarter and 24% lower than a year earlier.
UK Finance said the number of homeowner and BTL mortgages in arrears in the second quarter of 2009, the peak in arrears numbers during the global financial crisis, was 216,400.
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The repossessions currently taking place predominantly relate to older mortgages, with more than two-thirds relating to mortgages arranged at least a decade ago, UK Finance said.
It said that, while repossession is a “last resort”, customers who have been struggling with payments for a long time could find that repossession enables them to exit their mortgage while retaining as much of their home’s equity as possible.
Mortgage rates have jumped amid the conflict in the Middle East started and while some rates have edged down in recent weeks, they remain elevated amid uncertainty over the direction of interest rates.
James Tatch, head of analytics at UK Finance, said: “The number of mortgages in arrears continues to fall for both residential and buy-to-let mortgages. While possessions are up very slightly on the previous quarter, they remain low by historic standards.
“Lenders stand ready to support customers who may be worried about meeting their repayments. We would always recommend customers contact their lender as soon as possible to discuss the tailored help available.”
Mary-Lou Press, NAEA (National Association of Estate Agents) Propertymark president, highlighted concerns over potential future affordability constraints, “especially concerning current global unrest”, adding: “The current rate of inflation remains a key concern, and the impact this may have on the base rate remains to fully play out yet.
“Should homeowners find themselves in a position where they are worried about repayments, they should proactively speak with their lender at the very first opportunity, as they have a duty to help where possible and will also be keen to do so.”
