The latest figures from the Financial Conduct Authority (FCA) show that there was a peak in May of 181,153 mortgages, which then fell to 162,520 in June and 145,110 in July.
This is a rise from 341,000 mortgages in the previous three-month period and is also up from around 250,734 recorded in the same three-month period last year.
The FCA added that more people were increasingly locking in alternative deals before their new deals started, nearly doubling from 52,000 between February and April to 104,000 in May to July.
It is also up from around 23,882 recorded in the same period last year.
During the period this year, around 50,390 people locked in an alternative deal in May, followed by 18,324 in June and 35,517 in July.
Aldermore Insights with Jon Cooper: Edition 9 – Why lending strategy is becoming more central in buy to let
Sponsored by Aldermore
Looking at monthly payments, around 278,000 people switched to interest-only payments or extended their mortgage terms. This makes up around 3.1% of regulated mortgage contracts.
The number of people switching to interest-only has been slowly falling since last year, going from 6,247 in July last year to 4,690 in July this year.
The number of those asking for a new mortgage term has also been steadily declining, going from 3,741 in July last year to 2,620 in July this year.
The figures also show that 1,179 extensions were reversed, potentially showing that borrowers seeking a temporary reduction in their payments were more likely to opt for an interest-only switch.
Approximately 254 properties were repossessed within 12 months of missing their first payment. This was attributed to “customer-drive[n] reasons” like voluntary possessions and abandoned or vacant properties.
The report found that around 191,000 mortgages have temporarily reduced monthly payments as a result of Mortgage Charter rules, which were introduced in 2023.
There are around 49 signatories of the Mortgage Charter, representing around 90% of the mortgage market.
The commitments made by the signatories include not forcing a borrower to leave their home without their consent, unless in exceptional circumstances, in less than a year from their missed payment.
Customers should be allowed to lock in a new deal up to six months ahead of the end of a fixed rate deal and request a better like-for-like deal when the new one starts, if available.
Signatories should also allow customers who are up to date with payments to switch to interest-only payments for six months or extend their mortgage term. There should also be an option to revert to their original term within six months.
