Are the cracks showing? Or has the bad credit mortgages fiasco ended

The consumer is battening down the hatches for the long term. Borrowers with bad credit mortgages are all too aware of the predicament they are in.

Barratt homes told us this week that the Northern Rock factor has caused just a short-term blip in demand for housing, is this the usual riposte trotting out well rehearsed answers about supply shortages, rising population and high employment. Or is the bad credit mortgages fiasco got further to run.

What cant be ignored is that borrowers with bad credit mortgages have already stretched themselves to the limit on their finances. The sharp tightening up of lending by bad credit mortgages and loans companies over the last couple of weeks will lead to difficult times when borrowers come to remortgage.  

Bad credit mortgage approvals were down in volume terms during August compared to last year.