No signs of increase in mortgage lending, says expert

Date:Thursday 8th October 2009
Author: Max Freedman

There has been no indication that there will be more mortgage lending, but some banks have been forced to reduce their interest rates, says a property expert.

Chief operating officer at Alexander Hall Andy Pratt pointed out that several banks and building societies have reduced their rates in order to compete with the historically low 1.99 per cent interest deal being offered by HSBC.

However, Mr Pratt does not believe this cut in rates by lenders - such as Woolwich, Northern Rock and Abbey - will lead to them lending more.

He explained: "The likes of Abbey, who are obviously one of those that have reduced their rates, have had to do so and have cut their own margin in order to be able to compete."

This week, HSBC announced that it will be extending its 1.99 per cent interest mortgage deal until the end of October.

It was previously supposed to finish at the end of September.