The Council of Mortgage Lenders has admitted that critical data released last week contained multiple errors that severely understated the number of interest-only borrowers without an evident repayment vehicle by tens of thousands.
The gaffe brings into doubt whether the CML, which last year came under fire on numerous occasions for problems with its data, can be trusted to deliver an accurate picture of the market. Its figures are relied upon by the market, politicians and the media.
The CML incorrectly added up quarterly totals of interest-only customers for property purchase without a specified repayment vehicle, which left annual figures for 2005 and 2006 well short.
Original data suggested that there were 167,200 such borrowers in 2005, rising to 222,400 in 2006. The true figure was 184,100 rising to 243,000 although in both cases this represents a rise of around one-third.
A revised table was issued on the CML’s website last week after Money Marketing highlighted the problems.
A further random search by MM, after the CML correction, found six out of eight annual figures checked did not match the sum of the quarterly totals for previous years. This will be corrected this week although it is still not clear just how many errors the data contained.
CML spokesman Bernard Clarke says: “The quarterly data issued was correct but a systems error meant that some of the annual totals were not. This has now been corrected. Rounding up or down has produced minor discrepancies.”