This shows just what a task the regulatory authorities have in instilling confidence in a cynical population. We must hope that the messages of reassurances from the FSA and Bank of England and Chancellor Darling get through.
Clearly, this is mostly about lending and Northern Rock’s continuing ability to do so but, across the market, levels of lending will come under much more intense scrutiny – not just the ability of the sub-prime market to lend but of the prime market to relax income multiples.
What price will be put on such lending by money markets in future and what will this mean?
Mortgage IFAs and brokers will have to be at the top of their game to balance borrowers hoping to buy a property with their ability to pay perhaps even more than previously.