Landlords mortgage arrears decrease

The number of residential landlords in arrears on their mortgages has decreased, a new report has suggested.

Recently-published figures from the Council for Mortgage Lenders (CML) quarterly report, which include both homeowner and buy-to-let arrangments, have revealed a decline in the number of mortgages in arrears.

According to the study, 188,300 mortgages ended 2009 in arrears of at least 2.5 per cent of the outstanding balance.

This represented a three per cent decrease when compared to the three months to September 2009.

Michael Coogan, CML director general, said: "The fact that mortgage arrears and possessions did not rise as much as we feared in 2009 is testament to the effect of low interest rates, and a great deal of concerted effort by lenders, government and the advice sector to help borrowers to address financial difficulties when they occur.

However, Mr Coogan warned that a rise in the Bank of England's historically-low 0.5 per cent interest rate could mean challenges for mortgage customers.

"We are not out of the woods yet - 2010 will still be a challenging year for many borrowers, and some households will inevitably find their finances being squeezed if and when interest rates do eventually rise," he added.

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