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All quiet on the lending front

The mortgage market is at its least active since the 1990s, the British Bankers’ Association said today.

June saw a record low number of house purchase approvals, though re-mortgaging levels were similar to the previous month. Lending rose £3.8bn in June – compared with May’s £4.5bn rise.

Gross lending was 23 per cent lower than the same time last year. This meant approvals for re-mortgaging toalled a record 55 per cent of all mortgage approvals, compared with just 19 per cent for house purchase.

Meanwhile, new spending on credit cards was two per cent higher than a year ago but lower than in May, reflecting the lowest number of purchases since last July. Overdraft borrowing was also down for the ninth month in a row.

"The whole market is likely to be at its least active since the early 1990s," said BBA statistics director David Dooks. "The pressure on household finances is being reflected in subdued consumer borrowing, with spending on cards lower than of late and borrowing on personal loans and overdrafts comparatively weak."

This article was sourced from www.credittoday.co.uk

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