Whilst the number of customers with mortgage arrears continues to decline, those cases with more significant arrears have remained static year on year. The challenge for lenders in trying to balance their forbearance approaches remains difficult and has been that way for many years. Not so long ago, additional measures were being added year on year to foreberance strategies whereas more recently there has been refinement and a slight hardening around applying forbearance. The human decision making element of anyone involved in dealing with customers with significant mortgage arrears can clash by the hard mathematical £’s of the situation and whether a customer is benefitting or not from extended forbearance approaches. Unfortunately today there isn’t an equation that can combine all the factors in play to produce a right or wrong answer, but looking ahead if there is a hard Brexit and house prices fall 20%+ as predicted, interest rates go up as predicted and mortgage arrears rates rise as predicted, I’m sure analysts will get their spreadsheets out and have a go at developing one!
At Ascent we work with all our clients to ensure they have all the latest available information and data they can get so that fully informed decisions are made, when dealing with the most serious of arrears cases.
Figures from UK Finance found that there were 77,600 homeowner mortgages in arrears to this level, 5 per cent fewer than in the same quarter of 2017. Within the total, there were 24,090 homeowner mortgages with more significant arrears (representing 10 per cent or more of the outstanding balance), an unchanged figure from in the same quarter of the previous year.
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