UK Mortgage Lending Statistics 2026: FCA MLAR Data on Advances, Arrears and Possessions

DATA | MORTGAGES | FCA / BANK OF ENGLAND SOURCE

What is the MLAR and why does it matter?

The Mortgage Lending and Administration Return (MLAR) is a quarterly statistical return submitted to the FCA by all regulated mortgage lenders and administrators in the UK -- approximately 370 firms covering the vast majority of UK residential mortgage lending. The data covers regulated mortgages (owner-occupied residential) and non-regulated mortgages (primarily buy-to-let). The FCA and the Prudential Regulation Authority (PRA) jointly publish the aggregated statistics each quarter. The MLAR is the most comprehensive source of UK mortgage lending data available, covering advances, arrears, possessions, loan-to-value distributions and income multiples.

The MLAR differs from the Bank of England's separate lending statistics (which cover all secured lending including some non-MLAR lenders) and from the UK Finance or Nationwide/Halifax indices. It is the primary FCA regulatory dataset and provides the most granular picture of market structure and financial stress in the mortgage sector.

Gross advances Q1 2026: what the fall means

Gross advances fell 12.3% from Q4 2025 to £69.6 billion in Q1 2026. This looks alarming but is largely a seasonal and structural effect. Q4 2025 was inflated by the rush to complete before the Stamp Duty Land Tax changes that took effect on 1 April 2025 -- buyers raced to complete before the 31 March 2025 deadline, inflating Q4 advances. Q1 2026 reflects the hangover from that rush: fewer completions following the exhaustion of pent-up demand. The 10.2% year-on-year fall tells the same story -- Q1 2025 was also distorted by SDLT rush activity.

The more meaningful forward indicator is new mortgage commitments -- the value of mortgages approved for future drawdown. New commitments rose 11.5% from Q4 2025 to £78.0 billion in Q1 2026, and were 14.2% higher than a year earlier. This points to a stronger pipeline heading into Q2 2026 and suggests underlying mortgage demand remains resilient despite higher rates.

First-time buyer lending: falling share in a competitive market

First-time buyer (FTB) lending accounted for 27.4% of gross advances in Q1 2026 -- down 1.2 percentage points from Q4 2025 and 3.9 percentage points lower than a year earlier. In absolute value terms, FTB advances were approximately £19.1 billion in Q1 2026.

The falling FTB share reflects several concurrent pressures. Affordability remains stretched -- at an average house price of £270,080 and a two-year fixed rate of 4.81%, the income required to purchase an average UK property at a 4.5x income multiple exceeds £60,000. The FCA's regulatory priorities report for 2026 notes that mortgage market reform is specifically intended to address this: following a clarification of the interest rate stress test rule in March 2025, 85% of lenders updated their approach and are now able to offer borrowers approximately £30,000 more, directly supporting FTB affordability. Changes introduced in July 2025 also made remortgaging easier -- which has driven the rising remortgage share seen in the data.

The remortgage share rose to 28.1% in Q1 2026, up 6.8 percentage points year-on-year -- the highest remortgage share since 2023. This reflects the wave of five-year fixed deals taken out in 2020-21 at sub-2% rates now expiring, with borrowers switching to new deals rather than rolling onto the SVR (6.60% in May 2026).

Buy-to-let lending: holding steady at 8.4% of advances

Buy-to-let advances accounted for 8.4% of total gross advances in Q1 2026, broadly unchanged from Q4 2025. The value of BTL advances was approximately £5.8 billion. This stability masks significant underlying stress in the BTL sector -- the number of landlords selling properties (reducing the overall BTL stock) has been rising, but those who remain active are continuing to transact. The combination of higher mortgage rates, EPC Band C requirements (from 2030), and the reduction of mortgage interest relief since 2017 continues to erode BTL investment returns, particularly for higher-rate taxpayers with highly leveraged portfolios.

Mortgage arrears: improving but vulnerability remains

The value of outstanding mortgage balances in arrears fell to £20.1 billion in Q1 2026 -- the lowest level since Q3 2023 and 6.3% lower than a year earlier. The proportion of all outstanding mortgage balances in arrears was 1.1% -- down 0.1 percentage point year-on-year. This improvement is genuine: arrears peaked in H1 2024 as the impact of the 2022-23 rate rises fed through to those rolling off fixed deals, and have been falling since.

However, the FCA's own 2026 mortgage regulatory priorities report cautions against complacency. The aggregate improvement masks ongoing vulnerability in specific borrower cohorts -- particularly those who fixed at rates below 2% on five-year deals in 2021 and are now facing payment increases of £400-£600 per month or more. The FCA is watching these cohorts closely. Of the £20.1 billion in arrears, 9.3% are new arrears cases -- meaning the flow of new borrowers entering arrears has stabilised but not stopped.

New possessions in Q1 2026 were 2,216 -- up 1.6% from Q4 2025 but 4.3% lower than a year earlier. The total stock of possessions (properties in lenders' possession) was 9,247 -- the first quarterly decrease since Q1 2021. Despite this improvement, possession numbers remain 20.6% higher than a year earlier, reflecting the lagged impact of earlier arrears accumulation feeding through to possession proceedings.

Mortgage Charter: what lenders committed to do

The Government's Mortgage Charter, introduced in June 2023 and signed by 49 lenders representing around 90% of the market, includes commitments above and beyond FCA requirements for borrowers in financial difficulty. Key commitments include: no forced repossession within 12 months of the first missed payment (except exceptional circumstances); allowing customers to lock in a new deal up to six months ahead of their current deal expiry; and allowing customers who are up to date with payments to switch to interest-only for six months or extend their mortgage term, without an affordability reassessment.

FCA Mortgage Charter data published in March 2026 shows that 317 properties were repossessed within 12 months of missing the first payment -- all reported by firms as customer-driven (voluntary possessions or abandoned/vacant properties). The Charter has provided a meaningful buffer against repossession for distressed borrowers, though the FCA notes that Charter options form only part of the support lenders provide and all borrowers can discuss options with their lender regardless of Charter membership.

Loan-to-value distribution: high-LTV lending at post-2008 highs

The share of gross advances with a loan-to-value ratio exceeding 90% was 8.7% in Q1 2026 -- close to its highest level since the 2008 financial crisis. Within this, advances with LTV over 95% were 1.1%. High-LTV lending has been rising since 2023, driven partly by government support schemes and partly by lender competition for first-time buyers in a market where transaction volumes are constrained by affordability. The rising high-LTV share increases the mortgage market's sensitivity to house price falls -- a 10% fall in house prices would put a significant proportion of recently originated high-LTV loans into negative equity.

Source: FCA/BoE MLAR Q1 2026 (published 9 June 2026). OGL v3.0. All figures England, Wales and Scotland regulated mortgage lending. Q1 2025 figures revised.

When is the next MLAR release?

The next edition of the FCA/BoE mortgage lending statistics will cover Q2 2026 (April to June 2026) and is scheduled for publication on 8 September 2026. The data is collected via the MLAR from approximately 370 regulated mortgage lenders and administrators. Provisional dates are confirmed or revised no later than one week before publication.

For technical queries on the MLAR tables, the FCA publishes contact details at fca.org.uk/data/mortgage-lending-statistics. Detailed tables and summary tables in Excel format are available alongside the quarterly commentary at the same address.

Frequently asked questions

How much mortgage debt does the UK have?

The outstanding value of all residential mortgage loans in the UK was £1,746.1 billion (£1.75 trillion) at the end of Q1 2026 -- a record high, according to the FCA/BoE MLAR data published in June 2026. This is 2.6% higher than a year earlier. The vast majority is owner-occupied residential mortgages; buy-to-let mortgages account for approximately 8.4% of gross advances each quarter.

What percentage of UK mortgages are in arrears?

1.1% of all outstanding UK mortgage balances were in arrears at the end of Q1 2026, according to the FCA/BoE MLAR -- equivalent to £20.1 billion. Arrears are defined as the borrower failing to make contractual payments where the balance owed is equivalent to at least 1.5% of the outstanding mortgage balance. This rate has fallen from a peak of 1.3% in H1 2024 and is now at its lowest level since H1 2022, though it remains above the pre-2022 level of approximately 0.8%.

How many homes are repossessed each year in the UK?

In Q1 2026, 2,216 new possessions were recorded -- equivalent to an annual rate of approximately 8,864. The total stock of properties currently in lenders' possession was 9,247 at the end of Q1 2026. This is 20.6% higher than a year earlier, reflecting possessions from the arrears peak in 2024 working through the legal process. By comparison, possession numbers peaked at over 40,000 per year in 2008-09 following the financial crisis -- current levels are significantly lower in both absolute terms and as a proportion of outstanding mortgages.

What is the difference between gross advances and new commitments?

Gross advances are mortgage loans actually drawn down (completed) in the quarter -- the money transferred to borrowers. New mortgage commitments are mortgages approved and agreed but not yet drawn down -- offers made that will convert to completions in future quarters. When commitments rise faster than advances, it signals a growing pipeline of future lending. In Q1 2026, commitments (£78.0 billion) were significantly higher than advances (£69.6 billion), indicating that Q2 2026 should see stronger completion volumes as those commitments convert.

What does MLAR stand for and who submits it?

MLAR stands for Mortgage Lending and Administration Return. It is a quarterly regulatory return submitted to the FCA by all regulated mortgage lenders and administrators in the UK -- approximately 370 firms. Firms must submit the MLAR if they conduct regulated mortgage lending (owner-occupied residential mortgages) or administer regulated mortgages. The data covers both regulated and non-regulated (buy-to-let) lending by MLAR-submitting firms. The FCA and PRA jointly publish the aggregated statistics quarterly. The next edition covering Q2 2026 is due on 8 September 2026.