Banks must lend to tackle mortgage fall, expert claims

Banks must continue to lend money if the fall in mortgages is to be alleviated, it has been claimed.

Independent advice service MyMortgageDirect has said that pressure on banks to approve loans could negate the drop in mortgages brought about by the end of the stamp duty holiday and the adverse winter weather in the UK.

The comments follow the publication of a report from the British Bankers Association, which revealed that just 35,000 new mortgages were agreed in January this year.

This compared to the 46,000 that were approved in December 2009.

Catherine Hearnden, director of MyMortgageDirect, said: "There is pressure on the banks to lend, and we think that they have to do it.

"There are increased loan to values coming out, people are beginning to realise that if they want 90 per cent, they must pay for it. There is an emerging realism among people that if you have not got a huge deposit, then you must pay more on your mortgage."

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