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UK Mortgage Lending Excels in Third Quarter

UK Mortgage Lending Excels in Third Quarter

Tighter lending rules played a crucial rule in the decrease of mortgage lending over the past several months, according to data released by Bank of England. The group of first time buyers was hit especially hard. However, lending for the group climbed to more than £12bn during the third quarter of the year which is the highest level of lending since 2007.

Year on year during the third quarter, mortgage lending was up more than 12%, according to the PRA/FCA Mortgage Lenders and Administrators Statistics. This is a bit of a shock based on the comments circulating regarding the last few months.

Several new mortgage lending products were presented by the majority of house lenders. These new lending products offered flexibility for many people who were seeking houses or in search of a remortgage. The remortgage market is expected to pick up at the turn of the calendar year, especially with the possibility of a rise in interest rates. Something as simple as a rise in interest rates can mean the difference in a house owner paying hundreds and even thousands more than they should over the course of the loan term.

Fixed rate mortgages compared with standard variable rate mortgages have taken over the market and account for more than 82% of all approved mortgages.

Brian Murphy, head of lending at Mortgage Advice Bureau, commented on the above average amount of lending which took place in the third quarter, saying: "Lenders are firing on all cylinders to record the largest total advances in any third quarter since Q3 2008.

"This is a positive sign for consumers, who are benefiting from improved access to mortgage finance despite tougher affordability checks.

“Lenders are currently tripping over themselves to win business, with many of the major providers locked into a mortgage rate war.

"This is providing consumers with historically low pricing: it's therefore unsurprising that so many are choosing to lock into preferential deals, with MLAR statistics showing the proportion of advances at fixed rates is at its highest since tracking began in 2007.”

 

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