Mortgage misery hits nine-year high, 24,000 home loans behind on repayments

Tuesday, 6 May 2025

About 24,000 households are doing things so tough they have fallen behind on their home loan repayments, data from credit reporting company Centrix shows.

But the borrowers behind those past due home loans are just a subset of the 480,000 people who were behind on at least one of their credit contracts at the end of March, Centrix data shows.

Centrix collects data from the likes of banks, insurers, telecoms providers, finance companies and power companies, compiling credit reports on ‘credit active’ adults.

These reports show how well individuals are doing keeping up with their payments, and the data is used by Centrix to calculate a credit score of between zero and 1000 for each credit active adult, with higher numbers showing greater creditworthiness.

Centrix’s managing director Keith McLaughlin said at the end of March, home loan arrears exceeded seasonal expectations, with 700 more home loan accounts falling past due during the month.

Past due home loans were up 7% on March last year, though they still only represented 1.58% of mortgage loans.

The most serious of past due loans are those that have missed payments over three months old, making it hard for the borrowers to catch up, but they make up 0.33% of home loans.

Trouble paying the mortgage is the number one reason people seek hardship arrangements with their lenders. These are deals in which lenders agree to make changes to loan repayments to help people stay on top of their loans.

These changes can include things like temporarily suspending repayments, or moving a loan onto interest-only repayments for a period of time.

At the end of March, there were 14,400 accounts reported as being in financial hardship in March.

That was 200 lower than in February, but was still 11.5% higher than in March last year.

“Mortgage payment difficulties account for 45% of these cases, followed by credit card debt at 30% and personal loan repayments at 17%,” said McLaughlin.

“Despite the economic uncertainty, many individuals are proactively addressing financial hardship by engaging with lenders,” McLaughlin said.

“The highest rate of financial hardships is observed among individuals aged 35 to 49,” he said.

However, there are people as young as 18 with financial hardship arrangements with lenders, and even a handful who are over the age of 80.

That extreme range is revealing of the borrowing habits of households, with a large proportion of people remaining in debt after the age of 65.

At the end of March, the borrowers of one in 10 personal loans had missed repayments making it the loan type with the highest failure rate among borrowers.

That was only beaten by telco accounts, of which 10.9% had phone-users who had missed payments on their accounts.

By contrast, 4.7% of credit card accounts, 5.8% of car loan accounts, and 8.4% of buy now, pay later loan accounts were overdue.

Notably, 174,000 consumers are over 30 days past due, with 74,000 of them exceeding 90 days in arrears.

Despite the tough times for households, demand for some kinds of loan has started to rise. Mortgages, credit cards and personal loans are all in demand, while demand for buy now, pay later loans, and car loans was lower in March than it was a year before.

“New mortgage lending rose by 23.3% compared to the same period last year,” McLaughlin said.

“However, it remains 18% below the levels seen during the 2021 property market boom. New non-mortgage lending, which includes credit cards, vehicle loans, personal loans, buy now, pay later, and overdrafts, grew by 7.1% year-on-year, with vehicle loan activity being a key contributor.”

Overall new household lending increased by 21.7% year-on-year, he said.