Comment on FCA's MLAR statistics

11 March 2025

Richard Pike, chief of sales and marketing at Phoebus Software, says:

"The latest FCA data shows a continued recovery in mortgage lending, with gross advances and new commitments reaching their highest levels since 2022. Encouragingly, arrears and possessions have both declined from the previous quarter, suggesting that improving affordability, lender forbearance measures, and stabilising interest rates are helping to ease financial pressures on borrowers.

"While this is a positive development, the broader economic environment remains uncertain. Inflationary pressures have eased, and mortgage rates have continued their downward trend, but household budgets are still under strain from high living costs. The industry will be watching closely to see if this reduction in arrears is the start of a sustained trend or a temporary dip as borrowers adjust to new financial realities.

"Proactive arrears management will remain critical, particularly with a significant volume of fixed-rate deals due to mature in 2025. Lenders have increasingly turned to data-driven approaches to identify at-risk borrowers early and offer tailored support. The focus now will be on ensuring that these interventions continue to be effective in maintaining stability for both borrowers and the wider market."