In its half-year results to June 2013, UKAR reported it paid £391m to the government in interest, fees and corporation tax over the last six months.
In July, Virgin Money bought £465m of NRAM mortgages, which was used to pay off the government loan.
Arrears were lower than in 2011 as a result of proactive management and the benign interest-rate environment, said UKAR.
The total number of mortgage cases three or more months in arrears, including those in possession, have reduced by 9% since the end of 2011 to 30,222 cases to 30 June 2012. This is down from 37,966 in H2 2011.
The total amount of arrears owed by residential customers has fallen by £18.8m to £215.1m during the six months to 30 June 2012, a reduction of 8%.
UKAR said: “We have continued to invest in our technology and staff resources in the UKAR debt management functions delivering considerable improvements in our operational effectiveness.”
The company has 655,000 customers, holding between 612,000 mortgage accounts and 249,000 unsecured personal loan accounts and roughly 10% are struggling with repayments.
Over H1 2012 the firm made 34,000 mortgage arrangements and account modifications in partnership with several debt charities.
Richard Banks, UKAR chief executive, said: “We have made strong progress in the first half with further repayments to the Government.
Much of our focus is on helping those of our customers who are in financial difficulty and it is pleasing to see a further significant reduction in arrears levels despite the continued economic uncertainty and pressure on consumers’ finances.”
In July, UKAR was appointed by the government to run its Help to Buy mortgage guarantee scheme when it launches on 1 January 2014.