One in four mortgage holders using credit to afford their mortgage payments

^{7 November 2024}

UK Finance data out today reveals the number of homeowner mortgages in arrears are up 8% year-on-year. The data also shows that the number of mortgage possessions among homeowners are up 39% year-on-year.

This is echoed by StepChange Debt Charity’s own client data, revealing that among those with a mortgage seeking debt advice, mortgage arrears have been steadily rising this year, with average arrears per StepChange client now standing at £9,657, a 68% increase year-on-year.

While interest rates are expected to fall today, new YouGov polling commissioned by StepChange confirms ongoing difficulty for mortgage holder finances. Among UK adults with a mortgage:

• Two in five (41%) have found it difficult to keep up with bills and credit commitments in the last few months
• One in four (25%) have used credit to afford their mortgage payments (20% in September 2023)
• One in six (16%) have used credit, loans or an overdraft to make it through to payday. This compares to 11% of the wider population

Richard Lane, Chief Client Officer at StepChange, says:

“Even with an expected fall in the Bank of England’s base rate, we’ve not seen interest rates come down as quickly as they shot up in 2022 – and as we can see among our own clients in problem debt, this has taken its toll. Thousands of mortgage holders have faced new fixed rate deals over the past year or two with monthly payments eating up a much larger proportion of their income. This has had a knock-on effect on people’s ability to keep up with bills and repay other debts as they prioritise keeping a roof over their head.

“The effect on private renters can also not be underestimated – many landlords have passed on higher debt servicing costs to tenants, making their rental payments increasingly unaffordable.

“For anyone struggling with ongoing mortgage payments and housing costs, or worried about debt – don’t hesitate to reach out to your creditors and ask for help. Mortgage lenders have a regulatory responsibility to support borrowers who’re struggling, and may be able to provide forbearance. StepChange can also support with free and impartial debt advice including mortgage debt advice to those in difficulty.”

Notes to editors

1. UK Finance’s mortgage arrears and possessions stats can be found here.
2. All figures, unless otherwise stated, are from YouGov Plc. Total sample size was 2,211 adults of which 639 were mortgage holders. Fieldwork was undertaken between 9th - 10th September 2024. The survey was carried out online. The figures have been weighted and are representative of all UK adults (aged 18+).