Editor's note: This brief was summarised by The Property AI Newsroom from a report by Mortgage Solutions. Read the original article for full details.
Lloyds Mortgage Book Reaches £325bn Despite Higher Impairment Charges
Lloyds Banking Group’s UK mortgage portfolio stood at £324.9bn at the end of June 2026, up from £324.7bn at the end of March 2026. The bank’s retail division saw growth driven by UK mortgages and unsecured lending, with buy-to-let (BTL) mortgages forming a significant part of the portfolio.
As of 30 June 2026, Lloyds reported total UK mortgage loans and advances to customers of £325.5bn. This included £275.8bn in mainstream mortgages, £48.1bn in buy-to-let mortgages, and £1.7bn in specialist mortgages. Six months earlier, at 31 December 2025, the figures were £273.1bn for mainstream, £47.9bn for BTL, and £2.8bn for specialist mortgages, with a total of £323.8bn.
The bank also launched a £5,000 deposit mortgage scheme, making an additional £500m of lending available to support first-time buyers. During the period, Lloyds lent approximately £8bn to over 33,000 first-time homebuyers.
Arrears and Impairment Charges
Lloyds reported a higher underlying impairment charge of £617m, compared with £442m in the first half of 2025. The impairment charge for the first half of 2026 was £39m, higher than the credit of £133m in the first half of 2025.
Mortgage accounts more than three months in arrears represented 1% of total mortgage accounts as at 30 June 2026, an improvement from 1.1% at 31 December 2025. The value of loans more than three months in arrears fell to £3bn, down from £3.4bn six months earlier.
Shift Towards Higher Loan-to-Value Lending
The composition of Lloyds’ mortgage book shifted towards higher loan-to-value (LTV) lending. As of 30 June 2026, 51.9% of total mortgage balances had an LTV of less than 60%, compared with 54.2% at the end of 2025. Mortgages with LTV ratios between 70% and 80% rose to 16.4% of total balances, up from 15.2% six months earlier. Loans with LTV ratios between 80% and 90% increased to 13.4%, compared with 12.2% at the end of 2025. The proportion of loans with LTV ratios between 90% and 100% also rose to 2.4%, up from 2.2%.
The average LTV for new residential lending during the period was 66.2%, compared with 64.1% in the previous period.
These developments are relevant for UK letting agents and inventory clerks monitoring trends in buy-to-let lending, arrears, and the risk profile of new mortgage lending.
Source: Mortgage Solutions