Despite the increase in volume, the overall percentage of mortgages in arrears is relatively low, standing at 1.11% for homeowner mortgages and 0.69% for BTL mortgages.
The UK Finance report also highlighted a decrease in the number of homeowner and BTL properties in early arrears, which dropped by 2% and 11%, respectively, suggesting a movement of early arrears cases into deeper arrears, alongside a reduction in new early arrears cases.
For historical context, during the peak of the global financial crisis in the first quarter of 2009, the number of homeowner and BTL mortgages in arrears was 209,600, significantly higher than the current figure of 110,150.
UK Finance has also found that while there has been an increase in the percentage of properties taken into possession, this rise primarily stems from older arrears cases progressing through the court system.
The total number of possessions in the first quarter of 2024 was 1,470, a 26% decrease from the first quarter of 2019 and an 89% drop from the first quarter of 2009, which marked the peak of the previous possession cycle.