1 October 2010

Between April and June homeowners reduced their home loans by £6.2billion. Due to restricted equity and stricter lending criteria homeowners are choosing to pay off their existing mortgage, with concerns about job cuts leading to greater control over spending.

David Smith, Carter Jonas property consultant, said: “Homeowners have been reducing their mortgage debt for some two years now and this deleveraging will be for the long-term benefit of the property market and economy as a whole.”

The Bank of England has warned that obtaining a mortgage could become even more difficult. Lenders have “tightened credit scoring criteria” and were adopting a more “cautious approach”.

The mortgage news comes just days after the Nationwide revealed that house prices had risen by 0.1% in September. The average value of a UK property now stands at £166,757.


Source: The Telegraph


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