According to the Council of Mortgage Lenders (CML), the possession rate in the first half of this year (the proportion of all mortgages on which possession occurred in the period) was similar to that of the late 1990s but remained less than half of that experienced in the early 1990s. Of 11.74 million first mortgages, some 0.16% of these in H1 2008 were taken into possession, up from 0.11% in both the first and second halves of 2007.

However, the number of possessions has significantly increased in this half by 41% as there were 18,900 in this period from 13,400 in H2 2007.

On arrears, the total number of households with arrears of three months or more was 155,600 at the end of the first half of this year, up from 129,600 in H2 2007 and 120,800 from H1 2007. The arrears rate stood at 1.33% of all mortgages, up from 1.1% at the end of 2007 and 1.02% at the end of H1 2007.

Michael Coogan, CML director general, said: “ The number of people facing difficulty needs to be kept in perspective. The good news is that most people are coping well and continuing to pay their mortgages in full, despite the higher costs of food and fuel and the higher mortgage rates now prevailing in the market for those coming off cheaper original deals.

“But it is inevitable that more borrowers’ coping strategies will come under pressure in current conditions than in the unusually benign years of the last decade. Thats why lenders, the Government and the advice sector are working closely together to minimise the impact on borrowers.”