Council of Mortgage Lenders Say Lending Increases in June

council of mortgage lendersThe Council of Mortgage Lenders (CML) estimates that gross mortgage lending reached £17.5 billion in June. This is 4% higher than May (£16.8 billion), 17% higher than June last year (£14.9 billion) and the highest monthly figure since October last year (£17.6 billion).

Gross mortgage lending for the second quarter of this year was therefore an estimated £50.8 billion. This represents a 10% increase from the first three months of this year, and a 21% increase on the second quarter of 2013 (£41.9 billion).

Commenting on market conditions in this month’s Market Commentary, CML chief economist Bob Pannell observes:

“The macro-prudential interventions announced by the Financial Policy Committee in late June are finely calibrated and precautionary, but could nevertheless reinforce April’s Mortgage Market Review in tipping the UK towards a more conservative lending environment.”

“It is difficult to gauge the short-term direction for house purchase activity and mortgage lending more generally, given unknown regulatory impacts and uncertainty as to when the first in a series of interest rate increases will take place.”

Christian FaesChristian Faes, co-founder of LendInvest, a peer to peer lending platform, commented on the figures just released by the CML;

“Don’t believe all the hype – whilst the figures for mortgage approvals released today show that things have improved, even on best estimates we aren’t going to be more than 50% of the lending levels from the last cycle this year. The truth of the matter is, that it still remains painfully slow to get a mortgage in the UK. Borrowers seeking finance through mainstream lenders are hamstrung by seemingly limitless bureaucracy and red-tape, and even for those that are lucky enough to have their mortgage ‘approved’, they will find that it takes far too long to complete the process.

“The average Buy-To-Let mortgage in the UK takes between 3 to 6 months from application through to draw-down. At LendInvest we can usually provide funding within 2 weeks. We are using technology to not only make smarter credit decisions than the mainstream lenders, we are also able to do things in a much more efficient manner. Using the peer-to-peer model, this means that we are able to exploit the old-school mentality within the banking and mortgage industry, to provide a win-win for investors and borrowers.”

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