Over 2.6 million mortgage payment deferrals have been approved to date since March, with just under 140,000 still in place at the end of October, according to new data published by UK Finance.

There were 74,850 homeowner mortgages in arrears of 2.5% or more of the outstanding balance in the third quarter of 2020, which the banking body revealed was a total 5% greater than in the same quarter of 2019.

Within the total, there were 24,860 homeowner mortgages with more significant arrears – those representing 10% or more of the outstanding balance.

The latest Arrears and Possessions data from UK Finance also showed that early homeowner arrears – those less than 5% of balance in arrears – have declined in Q3 2020 as lender support, primarily in the form of payment deferrals, has helped borrowers keep up to date with their mortgage payments.

Later arrears, which UK Finance described are those in more than 7.5% of balance in arrears, have increased in 2020, although the new levels of these arrears are still significantly lower than levels seen in previous years. The banking body said that overall, arrears levels in 2020 remain near to the historically low levels of arrears seen in the last three years.

The data also revealed that there were 5,400 buy-to-let (BTL) mortgages in arrears of 2.5% or more of the outstanding balance in Q3, which was 19% greater than in the same quarter of last year. Within this total, there were 1,350 BTL mortgages in arrears of 10% or more of the outstanding balance.

“Since March, mortgage lenders have been offering payment deferrals to customers and BTL landlords where COVID-19 has impacted their ability to meet their monthly mortgage payments, with mortgage arrears remaining low in 2020 as a result,” UK Finance stated.

“Lenders are continuing to support customers through payment difficulties resulting from COVID-19. More information can be found by contacting your lender directly or visiting your lender's website.”

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