According to Fitch Ratings, UK prime mortgages amounting to more than £39bn, or 15% of total loan values in master trust programmes, are now in negative equity.

Fitch estimated that the negative equity figure could rise as high as 34% if house prices fall in-line with its forecast of a -30% decline from peak-to-trough, or down another -14% from today’s values.

About 270,000 borrowers were in negative equity in Fitch’s analysis, which included nearly 25% of all outstanding UK prime mortgages.

Northampton , Nottingham and Derby are the worst-affected cities, according to Fitch. The East Midlands had the highest proportion in negative equity at 21.8% of the total value, and Scotland the lowest at 5.4%.

Among master trust programmes, Northern Rock’s Granite had the highest proportion at 32% in negative equity, while Barclays’ Gracechurch had the lowest at 2%.