The number of both repossessions and mortgages in arrears continued to fall in Q3 2014 according to data from the Council of Mortgage Lenders.

The proportion of mortgages with arrears equivalent to 2.5% or more of the total mortgage value was 1.12% - down from 1.18% in Q2 2014 and 1.33% in Q3 2013, resulting in the lowest proportion since Q1 2008 (1.08%).

Commenting on the data, Paul Smee, CML director general, said: "Low interest rates, supported by intelligent communication and forbearance, mean that mortgage arrears and repossessions continue to decline.

"Encouragingly, recent research also suggests that many households are preparing themselves for the prospect of higher interest rates, so we expect any uptick in payment difficulties to be relatively muted if and when rates do begin rising. But a key activity for lenders now is considering how best to support their borrowers in planning ahead for a time when debt servicing costs are higher than they are now."

The proportion of all mortgaged properties taken into possession by lenders was 0.04% (5,000 properties), which is the lowest quarterly proportion and number since quarterly records began in 2008. The compares with 0.05% (5,400 properties) in Q2 2014, and 0.06% (7,200 properties) in Q3 2013.

Out of the total 5,000 repossessions, 1,100 were on buy-to-let mortgages, representing a marginally higher repossession rate of 0.07% in buy-to-let than the overall and owner-occupier rate of 0.04%.