July mortgage approvals rose slightly when compared to the levels reported in June according to the latest figures released by the British Bankers Association (BBA).  July mortgage approvals were valued at £7.1 billion for 55,364 mortgage approvals.  House purchases rose from 25,940 in June to 28,441 in July.  This marked an increase but when compared to house purchase mortgages in July 2011 there was a 17% decline.

Remortgages were up from June’s data level of 14,033 to 15,600 at a value total of £2.1 billion which is slightly more than the value recorded for June at £2 billion. 

The BBA responded to the data saying, “Gross mortgage lending of £7.1bn in July was below the recent monthly average and reflected continued low levels of activity in the housing market.”

July was the month that the Bank of England launched its Funding for Lending scheme to keep the cost of funding cheap for lenders.  The expected result is that lenders could stay away from the global lending market to fund their lending which was causing them to drive up interest rates and the cost of borrowing.  By having access to cheaper funding, lenders could keep borrowing cheap and available to consumers and small businesses.  The scheme has led many lenders to offer historically cheap deals including mortgage loans with interest rates below 3%. 

There have been many complaints that the below 3% deals are only available for those with high equity levels or deposits which is true.  However, there are many great deals that are slightly above 3% and they have no fees or much smaller fees and therefore are just as attractive and should be considered by homeowners and home buyers before they disappear.