Mortgage arrears and repossessions saw a further decline in the final quarter of 2025. 80,490 homeowner mortgages were in arrears of at least 2.5% of the outstanding balance, marking a 4% drop from the previous quarter. This equates to 0.92% of all homeowner mortgages, while buy-to-let (BTL) arrears accounted for 0.5%.
Among homeowner arrears, 27,780 accounts were in the lowest arrears band (2.5-5% of the balance), a 4% decrease from Q3 2025. The BTL sector also saw a 9% reduction in arrears, affecting 9,520 BTL mortgages. Of these, 3,480 were in the lightest arrears band, down 7% from the previous quarter.
Arrears levels remain well below those during the global financial crisis, when 216,400 mortgages were in arrears in Q2 2009.
Possessions also fell in Q4 2025, with 1,210 homeowner properties repossessed, a 13% decrease from the previous quarter. The BTL repossession figure dropped by 14%, with 770 rental properties taken into possession. These figures remain significantly below long-term averages.
Experts urge borrowers to reach out to their lenders if they are struggling to repay their loans. Speaking to a lender about support options will not affect a borrower’s credit score, and lenders are committed to providing tailored solutions to help manage financial pressures.
Talk to us about your properties.
