Cuts in interest rates and pressure on lenders to be lenient on people struggling with mortgages appear to have borne fruit, according to data published yesterday.

The number of mortgages slipping into arrears in the first three months of the year dropped by 12% from the previous quarter to just under 60,000, the Financial Services Authority reported.

Most of the decline was in non-regulated mortgages, which are dominated by buy-to-let and interest-only loans, but regulated mortgages falling into arrears were also slightly lower.

The slowing increase in mortgage arrears comes after the Bank of England has cut interest rates to 0.5%, partly nationalised several big banks, pumped money into the banking system and introduced measures to ease the strain on struggling homeowners.

Financial Times

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