April gross mortgage lending was lowest since 2000, at £10.2bn

Coogan: Politicians must grasp the nettle of the looming funding gap in the mortgage market

Gross mortgage lending declined to an estimated £10.2bn in April, down 12% from £11.6bn in March and 1% from £10.3bn in April 2009, according to data from the Council of Mortgage Lenders.

This is the lowest April total since 2000, when gross lending was £9.3bn.

The CML says a slight seasonal decline was expected as Easter fell in April this year, and gross lending remains broadly in line with its forecast for lending of £150bn for 2010 as a whole.

The trade body notes there have been signs of increased mortgage availability in recent months, with higher LTV mortgages becoming available and interest rates falling slightly.

But it remains a difficult market, particularly for first-time buyers without large deposits, and lenders continue to face funding challenges.
The CML adds that the imminent fiscal squeeze will act as a drag on the speed of recovery, which in turn will slow the pick-up in the housing market.

But it says the Bank of England’s warm welcome for the government’s plan to fix the public finances is likely to mean that interest rates remain low for longer than would otherwise have been the case, helping to support the market.

Michael Coogan, director general of the CML, says: “We welcome signs that some housing pri- orities are on the government’s radar. But we still do not know how the government plans to address the funding gap looming over the next few years in the mortgage market. It is important that politicians grasp this nettle.

“Unless funding issues are addressed any recovery in lending may be curtailed as the repayment date on support schemes draws closer.”

Phoebus system to underpin Link Loans relaunch

Phoebus Software is to provide the front-end origination technology behind the relaunch of Link Loans.

Link was forced to withdraw temporarily from the secured loans market towards the end of 2009 but announced its relaunch in March this year.

Paul Hunt, managing director of Phoebus, says: “After a lot of hard work by both companies Link has re-entered the secured loans market with a broker-focussed proposition. We hope this will be the first of many new entrants to this important lending sector in the near future.”