FSA: Repossessions down 12.1% year-on-year in Q4 2012

The number of new repossessions fell 12.1 per cent year-on-year in the fourth quarter of 2012, according to the latest mortgage lending data from the FSA.

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In the fourth quarter of 2012 there were 7,836 new repossession cases, compared with 8,924 in the fourth quarter of 2011.

There was a fall of 8 per cent from the third quarter of 2012, when there were 8,521 new repossession cases. There were 8,695 new repossession cases in the second quarter and 9,531 in the first quarter of 2012. Overall there were 34,583 new repossession cases in 2012.

The total number of cases in arrears in Q4 2012 stood at 301,776, compared with 303,168 in the previous quarter, a fall of 0.5 per cent. On an annual basis the number of cases in arrears fell by 3.7 per cent in Q4 from 313,224.

The total balance outstanding for all arrears cases fell slightly from £30.1m in Q3 2012 to £30m in Q4. Arrears made up 2.44 per cent of total loan balances at the end of 2012, compared to 2.61 per cent a year earlier.

According to the FSA’s data, new advances in Q4 amounted to £39.4bn, down 0.5 per cent on the £39.6bn in the previous quarter and down 1.8 per cent on the £40bn advance in the fourth quarter of 2011.

The average interest rate on new advances fell from 3.89 per cent in Q3 to 3.81 per cent in Q4. Average fixed rates fell from 4.33 per cent in Q3 to 4.10 per cent in Q4, while the average variable rate loan fell from 3.32 per cent in Q3 to 3.3 per cent in Q4.

Around 63.4 per cent of borrowers took out a fixed rate mortgage in Q4, up for 56 per cent in Q3 and 53.6 per cent in the fourth quarter of 2011.

New commitments reached £36.9bn in Q4, up 3 per cent than the £36bn reported in Q3 but down 0.4 per cent on the £37bn reported in the fourth quarter of 2011. The total value of outstanding loans at the end of Q4 was £1,229bn, an increase of 0.1 per cent on the previous quarter.

Lending for house purchase accounted for 66 per cent of new advances in the fourth quarter – the same as in Q3 – of which 19.1 per cent was to first-time buyers and 11 per cent to landlords.

The proportion of advances for remortgages rose in the quarter to 28 per cent, though was lower than Q4 last year – 32 per cent.

The proportion of new lending done at an LTV of more than 90 per cent remained at around 2 per cent, the level it has been throughout 2012. The proportion of loans to borrowers with an impaired credit history continued to be below 0.3 per cent, as it was throughout 2012.