32,000 homes face repossession risk 

New research by Mojo Mortgages has found that 32,000 mortgaged properties at risk of being repossessed.

The research also found that there were 96,580 homeowner mortgages in arrears of 2.5% or more of the outstanding balance, representing a 3% increase from the previous quarter.  Within this group, 32,470 mortgages were in the most severe bracket, with arrears exceeding 10% of the balance, marking a 6% increase compared to the previous quarter.

The increase in mortgage rates has been driven by base rate increases from the Bank of England (BoE) whicg have also played a major role.

After analysing their internal data, Mojo Mortgages have found that the average mortgage rate when remortgaging in April 2022 was 1.78%.  However, in April 2024, the average mortgage rate soared to 5.33%. In an effort to tame high inflation, the BoE has raised the base rate from 0.1% in late 2021 to the current 5.25%, which has resulted in mortgage rates increasing over the past couple of years.

As an example a £250,000 mortgage over 20 years, the monthly payment in April was £1,238. Fast forward to April 2024, and the same mortgage would now cost £1,695 per month – an increase of £457 per month.

That’s an extra: £5,484 over a year or 10,968 over a two-year fixed-rate term.