Mortgage arrears ‘set to rise’

Figures collected by online mortgage firm mform.co.uk show that with close to 14 million Britons aiming to buy a house in the next three years, more than half will take on loans worth three times the annual wage.

In addition, the recent study discovered that more than a quarter of those people aiming to get a foot on the housing ladder during the next three years would be prepared to borrow at least four times their annual earnings.

Francis Ghiloni, from mform.co.uk, said: “The average UK property has increased dramatically in recent years, growing by 8.9 per cent during the past 12 months alone.

“Indeed, we estimate that the average mortgage holder now pays over £7,000 a year on their mortgage, a rise of over £2,000 since 2004.”

Excluding mortgage arrears, the typical household debt management burden in the UK amounts to more than £8,800, Credit Action reports.