Loan Rates Rise in October

Wed, 28 Nov 2007

The Council of Mortgage Lenders (CML) has released figures showing the mortgage industry to still be in good health, despite the credit crisis. October’s gross mortgage lending totalled £32.4 billion, representing a 6 per cent increase on the previous month. Meanwhile, the figures demonstrated the continued expansion of the mortgage industry, as gross mortgage lending had been £30.6 billion the previous October.

However, despite the positive figures, the CML warned that it doesn’t expect the trend to continue, with lenders tightening credit standards in the wake of the US sub-prime crisis. The CML claims the figures are the result of mortgage requests approved prior to the credit crunch. However, with a decreasing proportion of mortgage applications proving to be successful since September, the gross mortgage lending totals are expected to fall.

Such is the impact of the credit crunch on the housing market, the CML are predicting that annual house price inflation in the UK will fall from its current rate of 9.7 per cent to 0 per cent in one years time.
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