Prime mortgage borrowers slide on repayments
Credit rating agency, Standard & Poor’s (S&P) has reported that the proportion of prime mortgage borrowers that are at least one month in arrears with repayments has risen 50%.
Prime borrowers are those with sound credit histories and in its UK Prime RMBS Index for the three months to the end of September, S&P puts the proportion having missed at least one payment at 3.24%, the highest level since the index was launched in 2000.
The percentage of borrowers in serious arrears, that is to say having missed payments for 90 days or more, increased to 1.16% of all loans, up from 0.96%.
The figures compare with those issued by the Council of Mortgage Lenders for the same period indicating that 1.44% of borrowers were up to 90 days in arrears with mortgage repayments, although the Council’s research includes input from sub-prime lenders.
The S&P report also notes that the housing repossession rate has risen slowly but steadily throughout 2008.
Turning to the sub-prime mortgage market, in November S&P reported that arrears for UK sub-prime mortgages increased to a record level of 25% in the three months to the end of September, from 23.3% in the second quarter of the year.