Mortgage lending falls in Summer

Mon, 21 Sep 2009

According to data from the Council of Mortgage Lenders, gross mortgage lending fell by 13% during August compared to figures from July. The CML have shown that mortgage lending, as well as house sales and house prices have all increased this year. However, mortgage lenders remain cautious about the vulnerability of the market.

The Bank of England warned that lenders are leery at the moment in the Trends in Lending report. The report apparently said: "There has been no increase in the proportion of lending accounted for by mortgages with loan to value ratios (LTVs) of greater than 90%. The major UK lenders remained cautious about prospects for house prices and unemployment."

An economist at the CML, Paul Samter, reportedly commented: "The likelihood of a significant pick-up in lending remains weak, but the prospects for wholesale funding markets are improving. This could result in a gradual easing in constraints on the supply of funding over time. However, demand from consumers and a prudent approach to lending criteria are likely to mean that the market remains subdued."
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