Arrears and repossessions among prime mortgage borrowers jumped sharply in the second quarter, according to a report by Moody’s which suggests that home loans are deteriorating even among borrowers with good credit records.
Mortgages held by Granite, the securitisation vehicle of Northern Rock, had the second-worst performance of those studied by Moody’s.
The credit rating agency examined the performance of more than 14 mortgage securitisations representing billions of pounds of home loans issued by Britain’s biggest banks.
It found the number of borrowers in serious arrears – more than 90 days – rose to 0.90 per cent of all mortgage loans, up from 0.60 per cent in 2007’s second quarter.
Moody’s also found that the number of homes being repossessed had more than doubled to 0.082% of home loans in the second quarter – up sharply from 0.037% in the same period of last year.