Sharp Annual Increase in Homeowner Mortgage Repossessions Recorded
New data from the banking and finance industry reveals a significant annual rise in homeowner mortgaged properties being repossessed. According to figures released by UK Finance, some 5,160 homeowner mortgaged properties were repossessed throughout 2025. This marks a substantial 39% increase compared to the 3,710 repossessions recorded in 2024.
Historical Context and Quarterly Analysis
Despite this notable annual jump, the overall number of repossessions remains significantly lower than long-term historical averages. The annual total for 2025 is dramatically lower than the 44,100 homeowner repossessions that occurred in 2009, during the peak fallout from the global financial crisis.
Examining the quarterly data, the fourth quarter of 2025 saw 1,210 homeowner repossessions. This represents a 17% increase compared to the same period in 2024, but is 13% lower than the number recorded in the previous quarter of 2025.
Mortgage Arrears Show Declining Trends
In parallel, the report provides detailed insights into mortgage arrears. During the fourth quarter of 2025, 80,490 homeowner mortgages were in arrears of 2.5% or more of the outstanding balance. This figure is 4% lower than the previous quarter and shows a 13% decrease compared to the same period in the previous year.
Within this total, 27,780 homeowner mortgages were in the lightest arrears band, representing between 2.5% and 5% of the outstanding balance. This category saw a 4% reduction from the previous quarter and a 12% decrease year-on-year.
For the most serious arrears bracket, over 10% of the outstanding balance, 30,280 homeowner mortgages were affected. This represents a 4% drop compared to the previous quarter and a 9% decline from a year earlier.
The overall proportion of mortgages in arrears remains low, at just 0.92% of all homeowner mortgages, according to UK Finance.
Buy-to-Let Sector and Lender Commitments
The data also covers the buy-to-let (BTL) sector. The number of BTL mortgages in arrears representing over 2.5% of the outstanding balance fell by 9% compared to the previous quarter, reaching 9,520 in Q4 2025. This is 25% lower than the figure from a year earlier.
Some 770 BTL mortgaged homes were repossessed in the fourth quarter of 2025, which was 14% lower than the previous quarter but 10% higher than the same period a year ago.
UK Finance emphasized that current repossessions predominantly relate to older mortgages, with more than two-thirds involving mortgages arranged at least a decade ago. The organization stated that for customers who have been struggling with payments over an extended period, repossession can enable them to exit their mortgage while retaining as much of their home’s equity as possible.
Lenders consistently assert that repossession is considered a "last resort," with a primary focus on keeping customers in their homes. UK Finance advises that anyone concerned about their mortgage payments should contact their lender promptly to discuss available options tailored to their circumstances. Importantly, contacting a lender to explore support options will not negatively impact an individual’s credit score.
Expert Commentary and Long-Term Perspective
James Tatch, Head of Analytics at UK Finance, commented on the findings: "As ever, the number of possessions remains low by historic standards and are broadly in line with pre-pandemic levels. Lenders remain committed to supporting customers who may be struggling. If you are worried about your mortgage payments, please contact your lender as soon as possible to discuss the tailored help available."
Looking back over a longer timeframe, the number of homeowner and BTL mortgages in arrears in the second quarter of 2009 – the peak during the global financial crisis – reached 216,400. This historical comparison underscores that while recent increases are notable, the current situation remains far less severe than during previous economic downturns.
