Good news first: fewer households are falling behind on their mortgage. The latest figures from the industry's lending body show that mortgage arrears have now fallen for a tenth consecutive quarter. But the people who read these numbers for a living are not all celebrating, and if you own a home or let one out, it is worth understanding why.
What the figures actually say
In the third quarter of 2026, the number of homeowner mortgages in arrears fell 10% year on year, to 76,080. Buy-to-let arrears dropped further still, down 22% to 8,170.
Put into context, the overwhelming majority of people are keeping up. Just 0.87% of homeowner mortgages and 0.43% of buy-to-let mortgages were in arrears in the quarter. That is a small slice of the market, and it is shrinking.
The part that moved the other way
Repossessions did tick up compared with the previous quarter. Lenders took possession of 1,840 properties, which is 3% more than in Q2, though still 20% below the level a year earlier. Among landlords, buy-to-let possessions rose 10% to 690 during the quarter, but remained 23% lower than twelve months before.
So the direction over the year is still downwards, but the quarter-on-quarter nudge upwards is the sort of thing lenders and advisers will be watching closely.
Why some experts are cautious
The concern is not what has happened. It is what may be coming. One commentator pointed out that borrowers coming off cheaper mortgage deals could face growing pressure, because the effect of higher borrowing costs takes time to reach people who have not yet moved onto a new rate. In other words, a fixed deal can hide the squeeze until the day it ends.
Another warning was that improving arrears figures can mask pressures underneath, such as households leaning on credit to cover everyday spending. That does not show up in a mortgage arrears number until it becomes a missed payment.
There was also a note that some landlords are now in minor arrears, with new rules such as the Renters' Rights Act suggested as one factor making conditions tougher. Even so, total buy-to-let arrears sit well below last year's level.
What this means for you
If you are a homeowner on a fixed rate, the most useful thing you can do is look at the date your deal ends and work out what your payment would be on a higher rate. Do it months before, not days. Leaving it late narrows your choices.
If you are a landlord, the same applies to your buy-to-let mortgage, and it is worth testing your rent against a higher payment. Our landlord page explains how we help owners keep a tenancy running smoothly, and our guide to the Renters' Rights changes covers the rules landlords now work under.
If money is getting tight, speak to your lender early. The industry's own advice is blunt: start the conversation sooner rather than later, and do not ignore the problem, because that only makes matters worse. Lenders are looking at options such as longer mortgage terms, interest-only payments and payment holidays. None of these is automatic, and each has a cost over time, so ask for the full picture before agreeing to anything.
If you are thinking about selling rather than refinancing, an honest valuation is a good starting point. It tells you what your home could realistically achieve in today's market, so you can compare staying put against moving on. You can book one through our valuation page, and our sales page explains how selling with us works.
Our view from Hornchurch
Locally, we see the same pattern the numbers suggest: most owners are coping well, but the ones who feel pressure are almost always the ones approaching the end of a cheap deal. Nothing here is a reason to panic. It is a reason to plan, and planning is free.
Mortgage rates and lender policies can change, so treat everything above as general information rather than personal financial advice, and check your own figures with your lender or a qualified mortgage adviser.
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Quick answers
Are mortgage arrears going up or down?
Down. Homeowner arrears fell 10% year on year in Q3 2026, and buy-to-let arrears fell 22%.
What should I do if my fixed rate is ending?
Check the end date now, work out your payment on a higher rate, and speak to your lender or a mortgage adviser early.
What if I am struggling to pay my mortgage?
Contact your lender early. Options can include longer terms, interest-only payments or payment holidays, each with a cost over time.