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Mortgage lending rising each year

24/07/2007

Mortgage lending throughout the UK has peaked record levels during June.

CML the Council of Mortgage Lenders released new figures and this showed that gross mortgage lending peaked over £34.2 billion during June, this an increase from
£31.4 billion May period.

Even as mortgage lending continues to rise, the increase was less than before between May and June in 2006, increased figures were 9 per cent to 12 per cent in the following year and 15 per cent in 2005.

CML director general Michael Coogan commented, "Despite the record level of mortgage lending, there are signs that the market is feeling the cumulative effects of the five interest rate rises we have seen over the past year."

"This effect will become much more evident in the coming months as borrowers with fixed-rate mortgages come off their existing deal into a significantly higher interest rate environment."

Senior economist at the Royal Institution of Chartered Surveyors, Oliver Gilmartin said: "Record borrowing levels will only add to the concerns at the Bank of England that higher interest rates will be necessary to curb consumers' appetite for debt.

"However, the continuing rise in longer term borrowing costs means that fixed rate mortgage deals are becoming increasingly costly and this will start to have a more material impact on borrowers as we move into the winter."


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