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Lending for new mortgages remains subdued

Lending for new mortgages remains subdued

Category: Mortgages

Updated: 11/09/2012
First Published: 11/09/2012

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Total mortgage lending rose marginally during the second quarter of this year, according to latest figures.

According to the Financial Services Authority (FSA), the value of new mortgages lent during April, May and June totalled £37 billion reflecting an increase of just 1%.

Banks and building societies are still cautious as to whom they lend their money to. This is reflected in the fact that lending for high loan-to-value (LTV) mortgages at 90% and above remained at 2% for the second consecutive month.

Although the number of high LTV products has increased from 193 in September 2010 to 274 today, strict lending criteria and credit checks mean approval levels are still low.

Arrears and repossession figures were slightly more encouraging. The regulator's Mortgage Lending Data report revealed that 8,720 repossessions were recorded in the second quarter, compared with 9,510 in the same period last year, reflecting a fall of 9%.

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