UK mortgage arrears hit highest level in six years

The news: Data released by the Bank of England (BoE) on Tuesday shows that mortgage arrears in the UK are at their highest level in six years.

The numbers: The BoE findings show that the proportion of mortgages in arrears relative to all outstanding mortgage balances increased during Q3 from 1.02% to 1.14%, the highest level since 2017. Additionally, the value of mortgages in arrears in Q3 increased by 11.4% from the previous quarter to £18.8 billion ($36.0 billion), an increase of 44% YoY.

The context: The figures underscore the impact that higher interest rates are bearing on households, with mortgage payments becoming more unaffordable. Many of the UK’s largest lenders have signed up to a mortgage charter, which encourages lenders to directly support and engage with customers who may be struggling with their mortgage burden.