Gross mortgage lending totalled an estimated £12bn in September, the lowest September figure for a decade.
Figures from the Council of Mortgage Lenders show that gross lending fell 1 per cent during September from £12.1bn in August to £11.9bn. The figures are also down 7 per cent from the £12.9bn gross lending recorded for September 2009.
Gross lending in Q3 increased 9 per cent to £37.4bn, but is down 4 per cent from the same period last year.
CML director general Michael Coogan says: “Lending volumes do not seem likely to increase substantially towards the end of the year. Funding pressures on lenders remain, and the practical implications of government and public spending cuts are beginning to emerge, with a resulting impact on consumer confidence.”
Coogan adds that despite the pressures on government finances today’s comprehensive review is not the time to make cuts in state support for borrowers who are struggling to pay their mortgage.
He says: “A concerted effort by borrowers, lenders, the government and money advice agencies has helped to keep mortgage arrears and possessions in check during the current economic downturn.
“These support measures help contain the wider costs of homelessness, and deliver wider benefits to the government. Now is not the time to weaken the existing safety net.”