Following the UK Finance arrears and possessions figures this morning, Richard Pike, Phoebus Software chief sales and marketing officer, says “Although the figures show very little change from the previous quarter the underlying number with more significant arrears is the figure that lenders should be watching. Forbearance during, and since, Covid has meant that lenders have had to change their processes and as such allow more significant arrears to build. With inflation and interest rates rising it is only right to expect that the number of borrowers in arrears is going to increase.
“Unfortunately, during the period of forbearance lenders didn’t have the need for large teams to deal with arrears. As things change it will be vital for lenders to ready themselves and get the infrastructure in place to deal with an inevitable rise in arrears. It will also be incumbent on lenders to manage borrowers and ensure that arrears don’t build up to an unhealthy level, otherwise repossessions too may rise.”