Equity release boost as mortgage arrears decrease

New figures show that there has been a fall in the number of homeowners in arrears on their mortgage, which could mean that more people may be able to take advantage of equity release products in future.

In the final quarter of last year, there was a four per cent drop in the number of mortgage accounts in arrears, according to data released by the Financial Services Authority (FSA).

By the end of the year, 378,000 accounts had fallen behind, which represents a similar level to that last seen at the close of 2008.

Lending for house purchase continues to represent an increasing share of new lending, the FSA revealed, accounting for 62 per cent of new advances in this latest quarter.

Commenting on the various government initiatives in this area, Firstrung chief executive officer Paul Holmes said: "As a short-term solution, it has been superb if arrears in whatever form have been wiped clean and people have a fresh start."

Ashall Glover Financial Services are equity release specialists