MorganAsh comments on UK Finance Arrears & Possessions data

14 August 2025

Andrew Gething, managing director of MorganAsh, said:

“Another quarterly drop in mortgage arrears is certainly welcome news, and with the downward trend in interest rates, there are good signs of affordability easing, which is good for new borrowers.

“Despite good work of the sector in early invention and forbearance, rising repossessions clearly show a growing number of borrowers in distress. This is reflected from figures from our customer PayPlan of the increase in numbers of mortgage holders seeking debt advice. While arrears numbers have dropped across the board, this increase in possessions likely stems from higher up the arrears bands where options can become more limited. There’s no doubt customer vulnerability becomes even more of a factor in these cases and lenders are best advised to keep these clients close.

“The sector has rightly prided itself on using repossession only as a final option. Given the circumstances though, there is real risk to this philosophy and that possessions could escalate further without early, personalised intervention. To do this properly and ensure a good outcome, we need to understand the case and more importantly, we need to understand the customer and their circumstances.

“By the very nature that they are in arrears, they are likely to be financially vulnerable, but as our data shows the vast majority of those in arrears have a compounding health or lifestyle vulnerability. Firms need to be able to identify and understand these wider challenges to provide the right type of support. Given the size of the mortgage books lenders have, and the number of borrowers they deal with, digitisation and tech adoption is paramount to achieve the efficiencies and accuracy lenders want and need.”