The Council of Mortgage Lenders said there were 27,100 repossessions, the highest figure since 1999, after people fell behind with repayments.
The figure for the UK is more than the 22,400 in 2006, but not as extreme as the CML had forecast. It is still a sharp rise on the 8,500 of 2003.
The CML warned that the number of repossessions was likely to rise again in 2008 as the credit crunch tightened.
Meanwhile, the numbers of mortgages behind on payments rose by 8.6% compared to 2006, the organisation, which represents mortgage lenders, said.