Slowing Mortgage Market 'Could Impact On Loan Borrowers'

Last month's slowing in mortgage lending could spell bad news for borrowers, one firm has claimed.

Price comparison service moneysupermarket has asserted that the mortgage industry is shrinking - meaning that lenders are looking elsewhere to cut costs and increase profits, including in lending such as personal loans.

The company was reacting to the latest figures from the Bank of England, released yesterday, which reveal that net lending to individuals last month stood at 11.2 billion pounds. While the figure is higher than August - and exceeds the previous six-month average - the growth rate remains unchanged suggesting a slowdown in the sector. Annual growth maintained at 10.0 per cent, while the three-month annualised growth rate rose only slightly, by 0.1 per cent to 9.6 per cent.

Commenting on the figures, moneysupermarket's head of mortgages, Louise Cuming, remarks: "The Bank of England figures prove the mortgage industry is a shrinking market. The lack of growth is bad news for both the mortgage market and the economy as a whole. The credit crunch has made lenders increasingly risk-averse with many withdrawing higher risk products, for example sub-prime loans and high loan-to-value products. We have also been in a rising interest rate environment and both these factors have dramatically constricted the market."

Ms Cuming added that there were likely to be a number of side-effects from the slowdown in the mortgage market affecting those looking for personal loans or cheap loans. Firstly, the need to maintain profitability is likely to push up the costs of secured loans and other traditional products. This is because high-risk lending to the sub-prime market, prior to the credit crunch, had been a highly profitable "cash cow", she explained, with the interest revenue now needing to be raked in from other products. Additionally, personal loan lenders are likely to be cutting back on investment and staffing costs.

Furthermore, the number of best rate loans available is also likely to be reduced, with some sectors finding it increasingly difficult to source appropriate products.

"Consumer choice is being eroded as for some people there are few, if any, products available. Also, what is open to them will come with a significantly increased price tag. I fear we will start to see rising arrears and repossessions," Ms Cuming continued.

She concluded by reassuring consumers that eventually the market will regain stability and normality will return, but warned that in the meantime borrowing is likely to become more expensive and lessons will have to be learned about the risks involved in sub-prime lending.

Over the summer, the Council of Mortgage Lenders warned that while interest rates may have reached the peak in their cycle, consumers should not expect an easing in their financial situations any time soon. With the continuing demands of utilities bills, mortgage repayments and other demands on personal finances stretching affordability to the limit, pressure is likely to continue impacting on household budgets. The CML was reacting to figures revealing a slowing in the level of lending to first-time buyers, symptomatic of a wider slowing in the housing market.

Tom Dawson is the Editor in Chief for Essentially Home Loans where visitors can apply for cheap loans online. We also specialise in debt consolidation loans, and secured loans

Vitamins For Faster Thicker Hair Growth
Hair Loss Diabetes And
Progesterone Male Pattern Baldness
Pattern Baldness
Male Patten Baldness
Hair Loss Baldness Treatment
Masturbation Dht And Baldness
Hair Loss Products Baldness Hair Loss Howtostophairloss
Vitamin For Baldness
Ebook2
Hair Loss Baldness Howtostophairloss Com
Drugs Used For Male Pattern Baldness
Baldness Hair Loss Balding Bald Websites
Baldness Cure The Future
Current Mens Hairstyles
Treating Baldness
Male Pattern Baldness Male Pattern Baldness Ourhairloss
Internet Income Mlm Home Business Opportunity Vemma Mlm
Baldness Hair Loss Male Ourhairloss Com Pattern Wig Wig
Stem Cell Baldness Research
Vacation Planner
Baldness Baldness Hair Howtostophairloss Com Loss Male
Hair Loss Symptom
Laser Hair Removal New Jersey
Black Hair Grow Fast Hair Loss Information Hair Loss
Stanford University Medical Center Head Lice
Baldness Prevention
Baldness Cure Propecia
Genettic Information For Baldness
Male Pattern Baldness Genetics
Hair Loss Products Baldness Baldness Baldness Howt
Common Baldness
Lanza Hair Care Product
Hair Loss In Cat
Vitamins Hair And Nails
Male Baldness Causes
Baldness Cure News
Patches Of Baldness In Women
Baldness Hair Howtostophairloss
Mexican Vacation
Baldness Help
Haircare
Baldness Gene In Women
Care Hair Organic Product
Hair Loss Young
Baldness Care And Treatment
Baldness Medical Cures
Stop Hair Loss
Hair Loss Treatment
Hair Loss Symptom
Baldness Sexy
Baldness Ketoconazole Sebum
Baldness Baldness Hair Loss Product Howtostophairloss
Where Can I Find Cures For Baldness
Mexican Vacation
Baldness Puerto Rico
Buy And Sell Couture On Ebay
African American Hair Care In Pennsylvania
Chemotherapy Hair Loss
Causes Of Patchy Baldness
Free Hair Loss Baldness Information
Cheap Vacation Deal
Hair Laser Male Removal
Remedy For Baldness
Baldness Vitamin
Drink Urine Baldness
Male Hair Loss Treatments
Hair Loss Grow Hair Prevent Baldness
Baldness Hair Loss Products Hair Loss Products Howtostophairloss
Blister Beetle Baldness
Baldness Remedies Treatments
Mens Black Hairstyles
Genetic Information On Baldness
1996 Massachusetts Baldness Study