Tighter rules believed to be behind a fall in mortgage approvals

13:39 02 June 2014

Tighter rules on mortgage approvals was said to behind a fall in mortgage lending figures

Tighter rules on mortgage approvals was said to behind a fall in mortgage lending figures

The number of mortgage approvals made to home buyers has dropped to the lowest level since last summer, according to Bank of England figures.

Some 62,918 mortgages worth £10 billion got the go-ahead in April, the lowest number since July and 17% below January’s peak of nearly 76,000.

The slowdown in housing market activity comes amid rising property prices and the launch of stricter lending rules, which came into force at the end of April.

Under the Mortgage Market Review (MMR), lenders have to spend more time questioning anyone looking to buy a home or remortgage about their personal spending habits, to assess whether they can afford their mortgage.

Lenders will also have to make sure an applicant could still cope with repayments when interest rates eventually rise.

Despite the slowdown in approvals, economists believe the Bank of England’s Financial Policy Committee may take further action to rein in the housing market as soon as its meeting later this month.

Likely measures may include higher capital requirements for banks for mortgage lending and limiting maximum loan-to-value ratios for mortgages.

Howard Archer, chief UK economist at IHS Global Insight, said: “While the MMR may well have some impact in reducing the risk of an overall housing market bubble developing, it will unlikely be sufficient as far as the Bank of England is concerned.”

Meanwhile, today’s figures also showed that unsecured consumer lending moderated to £666 million in April after rising to an 18-month high of £1 billion in March from £588 million in February.

Net borrowing on credit cards rose by £435 million in April, the largest increase in three years, although it followed a net repayment of £19 million in March.


Welcome , please leave your message below.

Optional - JPG files only
Optional - MP3 files only
Optional - 3GP, AVI, MOV, MPG or WMV files

Please log in to leave a comment and share your views with other Eastern Daily Press visitors.

We enable people to post comments with the aim of encouraging open debate.

Only people who register and sign up to our terms and conditions can post comments. These terms and conditions explain our house rules and legal guidelines.

Comments are not edited by Eastern Daily Press staff prior to publication but may be automatically filtered.

If you have a complaint about a comment please contact us by clicking on the Report This Comment button next to the comment.

Not a member yet?

Register to create your own unique Eastern Daily Press account for free.

Signing up is free, quick and easy and offers you the chance to add comments, personalise the site with local information picked just for you, and more.

Sign up now


Show Job Lists


Employers in East Anglia are paying staff more and looking at benefits packages in a bid to attract and retain staff.
Photo credit: Philip Toscano/PA Wire

If you excel at your job then now might be the time to speak to your boss about a pay rise or equally look for an upgrade in your benefits package.

                                 Managing Director of Bakers and Larners of Holt, Michael Baker, pictured at the Holt department store.


Family businesses are the lifeblood of the economy, but can often be weighed down by tradition. Now a report seeks to champion the region’s oldest family firms. Business writer SABAH MEDDINGS reports.

Green 100


Enjoy the Green 100
digital edition


Mustard TV

Meet the Team

Mark Shields

Business Editor


Chris Hill

Agricultural and Farming Editor


Shaun Lowthorpe

Business Publishing Editor


Sabah Meddings

Business Writer


Kate Royall

Business Writer


Duncan Abel

Business Development Manager

Business Most Read


Norfolk Future 50 EDP Business Awards Green 100

Business Most Commented

Newsletter Sign Up