Mortgage lending by mutuals down 10%

Consumers borrowed £2 billion from mutuals in October, a ten per cent reduction on the £2.2 billion borrowed in September.

Borrowers looking for the best mortgage rates will also be interested to hear that mortgage approvals fell by eight per cent, which has sparked concern that the mortgage market is weakening.

Adrian Coles, director general of the Building Societies Association, said: "Lending activity across the market has shown signs of weakening in recent months.

"Although lending by mutuals fell in October, gross lending remains similar to the average over the preceding three months."

He added that reports of falling house prices and the threat of public spending cuts have lowered consumer confidence and put further pressure on an already unstable market.

Figures also show that savings held by mutuals decreased in October as £1.3 billion was withdrawn in the month, compared to £0.8 billion in September.

Council of Mortgage Lenders figures for October show that gross mortgage lending was an estimated £12.4 billion, down nine per cent from £13.6 billion in October 2009.
 

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2010-12-06 11:49:58 © Moneyextra.com