UK Finance: Mortgage arrears and possessions – Q3 2026

Key Information

• The number of homeowner mortgages in arrears fell for the tenth consecutive quarter in Q3 2026 to 76,080, down 10 per cent on the year and two per cent on the quarter.
• The number of buy-to-let arrears was also down 22 per cent year-on-year and three per cent on the quarter.
• Mortgages in arrears made up 0.87 per cent of all homeowner mortgages and 0.43 per cent of all buy-to-let mortgages in the third quarter of 2026.
• The number of properties taken into possession was 20 per cent lower than a year earlier, increasing just three per cent on the quarter.
• Mortgage lenders continue to offer tailored support to anyone struggling with their mortgage payments. Anyone worried about their mortgage payments should reach out to their lender at the earliest opportunity to discuss the options available.

Homeowner and Buy-to-Let Mortgage Arrears

The number of homeowner mortgages in arrears fell for the tenth consecutive quarter in third quarter of 2026 to 76,080, down two per cent on the quarter and 10 per cent year-on-year.

The number of buy-to-let arrears also fell 22 per cent year-on-year and three per cent on the quarter to 8,170.

Whilst the number of buy-to-let mortgages in the lightest arrears band increased modestly compared with the previous quarter, it remained 18 per cent lower than a year earlier.  Aside from this, numbers of arrears in all other bands fell in both the homeowner and buy-to-let sectors.

The vast majority of customers are still making their payments on time. Mortgages in arrears made up 0.87 per cent of all homeowner mortgages and 0.43 per cent of all buy-to-let mortgages in the third quarter of 2026.

Possessions

Although possession numbers rose slightly compared with Q2, from 1,780 to 1,840, this was 20 per cent down on the same quarter in 2025. This was the second consecutive year-on-year fall, with numbers significantly lower than historical peaks. Within the total, homeowner possessions were down 17 per cent year-on-year and unchanged on the quarter, remaining at their lowest level since Q4 2024. Whilst buy-to-let possessions increased 10 per cent on the quarter to 690, they remained 23 per cent below a year earlier.

Source: UK Finance Data

Lender Support for Borrowers  

Mortgage lenders continue to offer support to help customers manage their payments, even as financial circumstances change. Anyone worried about their mortgage payments should reach out to their lender at the earliest opportunity to discuss the options available for their circumstances. Contacting your lender to find out what support is available will not impact your credit score.

James Tatch, Head of Analytics at UK Finance, said:

“The latest arrears and possessions data shows that borrowers are continuing to manage their mortgage payments despite rising cost pressures.

“With homeowner arrears falling for a tenth consecutive quarter, and possessions well below historic highs, the overall picture is one of a resilient mortgage market, with the vast majority of customers continuing to make their repayments on time.

“Despite the positive news on falling arrears, we know customers are currently dealing with a rising cost of living, as well as the impact the war in the Middle East is having on interest rates.

“Mortgage lenders remain committed to supporting customers who are facing difficulties. Anyone worried about keeping up with their repayments should contact their lender as soon as possible to discuss what tailored support is available to them.”