Tuesday, February 02, 2010
Demand for UK credit increases again
New borrowing on credit cards, loans and overdrafts has outstripped the amount being paid back by UK consumers for the first time since June last year.
Unsecured consumer credit rose £52m in December, driven by credit card borrowing, the Bank of England said.
The number of mortgages approved for house purchases dipped slightly compared with November, to 59,023.
This was still higher than the average of the past six months, when the housing and mortgage markets picked up.
The trend during the downturn has been for consumers to pay off debts, often instead of saving when interest rates are so low.
For five consecutive months, repayments outstripped new unsecured consumer credit. However, in December, the trend reversed, the Bank of England's figures show.
This was primarily the result of borrowing on credit cards, which rose by £195m. Demand for personal loans and overdrafts remained low, with repayments outstripping new borrowing by £143m.
Total net lending to individuals rose by £1.2bn in December, double the average of the previous six months. The vast majority of lending is in the form of mortgages.
The number of people remortgaging rose slightly - to 27,276. This was still a traditionally low level as people chose to benefit from low interest rates by staying on their mortgage provider's variable rate when their fixed-rate deal came to an end.
The Bank rate is widely expected to remain at record lows for some months.
Unsecured consumer credit rose £52m in December, driven by credit card borrowing, the Bank of England said.
The number of mortgages approved for house purchases dipped slightly compared with November, to 59,023.
This was still higher than the average of the past six months, when the housing and mortgage markets picked up.
The trend during the downturn has been for consumers to pay off debts, often instead of saving when interest rates are so low.
For five consecutive months, repayments outstripped new unsecured consumer credit. However, in December, the trend reversed, the Bank of England's figures show.
This was primarily the result of borrowing on credit cards, which rose by £195m. Demand for personal loans and overdrafts remained low, with repayments outstripping new borrowing by £143m.
Total net lending to individuals rose by £1.2bn in December, double the average of the previous six months. The vast majority of lending is in the form of mortgages.
The number of people remortgaging rose slightly - to 27,276. This was still a traditionally low level as people chose to benefit from low interest rates by staying on their mortgage provider's variable rate when their fixed-rate deal came to an end.
The Bank rate is widely expected to remain at record lows for some months.
Loans Calculators Blog- loans rates blog for news about interest rates- unsecured and secured loans, mortgages, remortgages and refinancing including home loans, equity release and consolidate debt loans.
Labels: Bank of England, credit crunch, home loans, Loan calculator, loans
