Mortgage borrowing rises whilst credit card borrowing decreases
According to recent figures released by financial specialists in the UK the level of borrowing for mortgages has risen quite steeply in the UK, and at the same time borrowing on credit cards has seen a decline. Overall, there has been a two percent rise in consumers credit in the UK over the past year, which includes a combination of personal loans, overdrafts, and credit cards. However, credit card borrowing was three percent lower in November 2006 than in November 2005, and consumers’ repayments exceeding their borrowing.
In relation to mortgage borrowing, consumers in the UK borrowed nearly twenty one and a half billion for mortgages in November 2006, which was a thirteen percent rise from October 2006 and an impressive nineteen percent higher than in November 2005, indicating that continuing rises in property values in the UK were not having an adverse effect on property purchasing.
The figures were released by the British Bankers’ Association. The Director of Statistics from the Associations stated: "In the mortgage market, the high number of loans approved in November, which is not usually a strong month, suggest that the trend in mortgage lending will continue to be robust over the next few months. "
He added: "Monthly spending on credit cards and the value of new personal loans taken out have been generally lower in 2006 than in the previous couple of years, while repayment levels have been maintained, leading to this year’s picture of subdued borrowing."
Another analyst speaking about the drop in credit card borrowing said: "This is clearly a consequence of consumers striving to find less expensive ways of financing their spending, and switching more to secured borrowing. Elevated debt levels, higher interest rates, rising unemployment and increasing pension concerns means that there is an increased need for many consumers to try and improve their finances."
More Information:
- Mortgage article here......
External Links: