Banks and building societies have released figures showing mortgage lending in January
slumped by 26% compared with the month before.

Lenders blame the lending low on a package of factors like cold weather, Christmas and
uncertainty over interest rates.

Nevertheless, the main reason was not highlighted – they simply chose not to lend any more.

The Council of Mortgage Lenders, the trade body that speaks for all the country’s major house
lenders, puts together a ragbag of lending figures every month but always misses one vital statistic.

How many people apply for mortgages but fail to have the loan agreed?

The CML is representing that lending is low because of factors brought to bear on borrowers.

The fact is the number of borrowers has not fallen, it’s the number of mortgages available
from lenders that has plunged.

The trend is depressingly downward.

In January, the figures show 28,500 loans advanced for house purchase, worth £4.2 billion, a
fall of 29% by number and 26% by value on December.

The CML also massages the stats by not giving December’s actual figures – nor those for the
month before so a trend is established.

The figures are hidden away on the CML web site if you know where to look.

Mortgage lending for November 2010 was 44,000 loans worth £6.3 billion advanced to

For December the figures were down to 39,900 loans worth £5.7 billion.

The year-on-year figures for January compared to January 2010 also show a decline – a 13%
drop in the value of loans advanced from £4.83 billion and a 14% drop in the number of
mortgages from 33,139.

CML director general Michael Coogan said: “Pressures on household budgets have been
increasing both in terms of take home pay, and indirect tax measures such as the VAT increase
and recent inflationary pressures, so we were expecting a fall in transactions early in the year,
and a flat mortgage market underpins our forecasts for 2011.

“The bad winter weather and uncertainty over interest rate rises will have exacerbated
the fall in lending in January, so it would be premature to draw any firm conclusions
about activity levels over the next few months. The market remains stable at low levels
of transactions.”

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