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Mortgage lending increased to £2bn


Mortgage lending increased to £2bn during October, but lenders predict a slowdown ahead.

The Council of Mortgage Lenders revealed new data showing that gross mortgage lending increased by 6% during October to £32.4bn, from £30.6bn in September.

The group stated that mortgage advances would plunge over the outstanding months, due to the effects of the current credit crunch hold.

CML group confirmed that during October period, there was an increase, which was double the 3% seasonal rise. Lenders said advances would drop towards the end of the year - taking borrowing under the £1bn per day presently being seen.

Michael Coogan, CML director commented: 'Next few months will be a testing time as ongoing pressures in financial markets feed through into the wider economy.

'The Bank of England's recent Quarterly Inflation Report reinforced the likelihood of a reduction in rates early next year.'

The Building Societies Association witnessed an increase in mortgage lending during October, through total advances by its members touching £4.65bn. Net lending was £1.12bn, a level last seen in June.

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