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Mortgage Lending Down 19% as Cost of Mortgages Rises.
Mortgage lending remained slow in May 2008 with total lending down 19% over the year, says they from the Council of Mortgage Lenders (CML).
Tightened lending criteria and falling confidence in the housing market contributed to a £5bn fall in the value of mortgages advanced - from £31.5bn in May 2007 to £26.5bn last month.
The CML said the Bank of England’s data on mortgage approvals for house purchases suggested lending would continue to be weakfor months to come.
Lending has recovered slightly since reaching a record low of £23.9bn in December last year, but much of the activity has been remortgages rather than loans for house purchases.
Recent figures from the Bank showed the number of approvals reached a record low in April, with just 58,000 mortgages approved for purchases - a fall of almost 49% on the previous April.
Mortgages becoming more expensive
According to financial information firm Moneyfacts, the cost of fixed-rate home loans has reached 10-year high with many of the most attractive rates exclusively for those looking to borrow only 75% of the value of their home. This is make the threat of repossession more like to those struggling to maintain payments once they sweetener period of their mortgage has expired.
