Mortgage Lending ‘fell by 30% last year’
There was huge contraction in the amount of mortgage lending in 2008. The credit crunch has swept through the housing market and all but obliterated most of the mortgage deals that were available in 2007.
The CML figures show total lending is down by a third on 2007’s figure of £364bn and is at its lowest level since 2002, these figure demonstrate the impact of the credit tightening on the market. Mortgage lenders pulled there high loan to value deals that were attractive to first time buyers as they found it increasingly hard to raise the funds as the money markets dried up and the cost of inter bank lending started to rise.
Most lenders still don’t have any high loan to value mortgage deals available as they are still wary of first time buyers. They have adjusted there credit score to ensure only the best clients qualify. For a first time buyer to stand a chance and that includes shared ownership and shared equity purchases you must tick all the correct boxes.
The government has outlined its new proposal this week to help unfreeze the market and get lenders lending again. But if lenders open there doors again to new business will people be reluctant to buy whilst house prices are still falling.
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