Mortgage Approval Rates Increasing

According to figures released by the Bank of England, mortgage approval rates have increased steadily since May, seeing the number of mortgages being approved rise by a figure exceeding 40,000.

This is the fifth month in a row that the Bank of England has observed this rise in mortgage rates, which looks set to reinforce a general recovery in the finance and housing market.

This is all helping to reassure homeowners that the recent fall in prices in the housing market is finally slowing down with house prices gradually increasing, this is also providing a bit of welcome news for the troubled British economy.

Whilst analysts have criticized the rise in rates as negligible, the Bank of England’s data is still reassuring, as they show that net lending for house purchases is actually growing.

At the same time, The UK’s largest house builder, Persimmon has announced that the outlook is looking a great deal more optimistic this year when compared with the last, after reporting a £50 million increase in sales.

However, compared to the previous year mortgage approval rates are down over a third.  As a result, the Building Society Association has complained that Banks are competing unfairly and that steps need to be taken to ensure that competition is not distorted as building societies have observed a drain in savings for the third consecutive month.

The Nationwide Building Society has recently introduced a 125% mortgage in a bid to allow existing customers in negative equity to borrow increased amounts.

Traditionally, the building society offers loans up to the value of 85% of a property, and nationwide has received much criticism based on the fact that loans above 100% were responsible for much of the financial crisis, and a repossession rate which is 50% higher than previous years. Nationwide’s recent offer has left many people are sceptical about the Nationwide Building Society’s recent decision

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