Less willing to risk homeowner debt

There has been a 24 per cent decline in the gross amount of mortgage lending in the first quarter of 2010, new figures show.

The Council of Mortgage Lenders (CML) reports that between January and March this year, less than £30bn (£29.5bn) was lent, compared to nearly £40bn (£38.9bn) in the last three months of 2009.

CML economist Paul Smater admits that whilst the number taking on home repayments is “subdued,” it is “comfortably higher than in the depths of the recession a year ago.”

Indeed, lending figures for March were up nearly a quarter (24 per cent) on February, at £11.5bn. More are expected to take on homeowner debt from this month, following the re-introduction of the stamp duty holiday for first time buyers.

Kevin Still, director of Atlantic Financial Management, says: "With the general election imminent and a number of measures to curb government borrowing, consumer confidence is obviously subdued. Many people have used reduced interest rates to clear down mortgage and credit card debt."

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