Mortgage Lenders and Administrators Statistics - 2023 Q2

• The share of gross mortgage advances with interest rates less than 2% above Bank Rate was 96.1% in 2023 Q2, 2.3pp higher than last quarter. This was 4.8pp higher than a year earlier and the highest seen since 2007 Q3 (Chart 2).⁴
• The share of advances with interest rates between 2% and 3% above Bank Rate decreased over the quarter to 1.7% from 3.4%, while the share of advances with interest rates 3% or more above Bank Rate decreased by 0.6pp to 2.2% from 2023 Q1.^5,6

• The share of advances with LTV ratios exceeding 90% increased on the quarter, by 0.4pp, to 4.4% in 2023 Q2. This was 0.1pp lower than a year earlier (Chart 3).⁷ Within this, the share of mortgages advanced with LTVs over 95% was 0.2%, broadly unchanged compared to the previous quarter.⁸
• The share of mortgages advanced in 2023 Q2 with LTV ratios exceeding 75% increased by 4.0pp on the quarter to 36.5%. This is 1.7pp lower than a year earlier.⁹

• The proportion of lending to borrowers with a high loan to income (LTI) ratio increased by 1.6pp on the quarter to 45.3% in 2023 Q2, but was 5.2pp lower than a year earlier (Chart 4).¹⁰ Borrowers with high LTI are defined here as:
• Borrowers with single income who had a LTI ratio of 4 or above. These loans accounted for 8.1% of gross mortgage lending in 2023 Q2, a 1.1pp decrease compared to the previous quarter and the lowest observed since 2009 Q1.¹¹
• Borrowers with a joint income who had a LTI of 3 or above. These loans accounted for 37.2% of gross mortgage lending in 2023 Q2, a 2.7pp increase compared to the previous quarter.¹²

• The value of outstanding balances with arrears (defined as the borrower failing to make contractual payments equivalent to at least 1.5% of the outstanding mortgage balance or where the property is in possession) increased by 13.0% on the quarter and 28.8% on a year earlier, to £16.9 billion. This was the highest seen since 2016 Q3 (Chart 6).²⁰
• The proportion of total loan balances with arrears increased on the quarter from 0.89% to 1.02%, the highest since 2018 Q1.²¹
• New arrears cases equated to 16.0% of the total outstanding balances with arrears in 2023 Q2, which was little changed compared to the previous quarter.

¹ Table 1.11 sub table A row 9

² Table 1.21 sub table C row 1

³ Table 1.21 sub table C row 3

⁴ Table 1.22 sub table C row 3 (less than 2% above)

⁵ Table 1.22 sub table C row 4 (2.00% to 2.99% above)

⁶ Table 1.22 sub table C row 5 + row 6 (3% or more above)

⁷ Table 1.31 sub table C row 19 + row 20

⁸ Table 1.31 sub table C row 20

⁹ Calculated as 100% of all mortgages less those <= 75% LTV (Table 1.31 sub table C row 21 - row 17)

¹⁰ Table 1.31 sub table C row 5 + row 13

¹¹ Table 1.31 sub table C row 5

¹² Table 1.31 sub table C row 13

¹³ Table 1.33 sub table C row 4 (buy-to-let)

¹⁴ Calculated as 100% of all mortgages less those for buy-to-let purposes (100% - Table 1.33 sub table C row 4) (owner-occupation)

¹⁵ Table 1.33 sub table C row 6 (remortgage)

¹⁶ Table 1.33 sub table C row 2 + row 3 (house purchase owner occupation)

¹⁷ Table 1.33 sub table C row 5 + row 9 (further advance and other)

¹⁸ Table 1.33 sub table C row 2 (first-time buyers)

¹⁹ Table 1.33 sub table C row 3 (home movers)

²⁰ Table 1.7 sub table C row 10

²¹ Table 1.7 sub table C row 11