British lenders are hoping mortgage rates it increases as inflation and recession concerns are predicted to increase the number of loan defaults.
Of the Bank of EnglandThe quarterly Credit Rating Survey revealed that UK lenders predicted a further expansion in mortgage lending in the three months to is at the end of February.
The bank also admitted that they expect many British families will not be able to pay their loans during the cost of living. The study said that the default rate remained unchanged in the last three months of 2022 but “was expected to increase in Q1”, meaning December to the end of February .
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Mike Staton, managing director of Mansfield-based mortgage broker Staton Mortgages, said: Mortgage rates were crazy in the run-up to Christmas. It’s like Ebenezer Scrooge setting prices. We are now seeing an increase in the number of borrowers defaulting on their mortgages recently.
“The last three years have been very difficult for people’s finances and inflation and price hikes following the mini-Budget were the straws that broke the bank. the back of the camel. unsecured loans to increase in the coming months.”
The survey also warned that lenders expect reduced availability of mortgages, consumer loans and business loans to decrease in the coming months.
Kylie-Ann Gatecliffe, director at Selby-based broker, KAG Financial, said: “Amidst the doom and gloom the mini-Budget left in its wake, many mortgage products were withdrawn from the market. almost overnight, and explains the decrease. supply.”
Of the Bank of England previously stated in its Financial Stability Report that economic conditions have worsened, with British households being “stretched” by rising interest rates and rising costs.
“The heavy burden” will be placed on the ability of families to pay their debts because the monthly payments on 4 million mortgages are expected to increase next year.
Justin Moy, founder of Chelmsford-based mortgage broker, EHF Mortgages, said: “The fixed rate eased as financial markets became more secure and confidence returned in part. 2023 has seen more relaxation, but the lenders will not want to go below 4% alone in the market for fear of pressure actions, but the use of cartel-style A lender can help ease the burden.
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Overall mortgage lending is expected to fall by 15%, going forwardinfectious diseases in the world situation, according to UK Finance.
The trade association expects the number of property transactions to fall by 21% next year from 1.2 million in 2022 to 1 million in 2023.
The cost of loans to home owners is expected to fall by 23% and loans to owners of land should fall by 27%.