Mortgage lending falls again
The latest figures from the Council of Mortgage Lenders (CML) reveal that total mortgage lending was down by 27 per cent in July this year, compared to 2007. There was some good news with a 5 per cent monthly increase from June to July this year.
Bob Pannell of the CML said: “While there was a small month-on-month increase in activity, it represented a notable decline from a year ago.”
“This continues the weaker picture seen in June and points towards the more subdued levels of lending we are likely to see in the second half of 2008.”
According to the latest reports housing sales have dropped by 50 per cent this year, which is further backed-up by CML figures saying so far in 2008 only 29 per cent of mortgages have been for new house purchases. Every other mortgage has been provided for people looking to remortgage, to find a better deal, or remortgage to raise more cash against the value of their property - a very risky strategy given the current house price slump, which could easily end up as a negative equity situation if people borrow too heavily.
Mortgages are getting more competitive but only for people who can afford to pay a 25 or 30 per cent deposit, so in other words don’t look to borrow more than 70 or 75 per cent of the property value and you should be able to find a good mortgage deal.