"The Funding for ending Scheme has made the mortgage market more competitive, allowing smaller institutions to offer attractive rates"
-BBA statistics director David Dooks
The number of mortgages approved in the U.K. inched higher in line with analysts' forecasts last month, suggesting nation's 'Funding for Lending' scheme works properly. The British Bankers' Association said that lenders granted 31,227 approvals in March, up from 30,579 a month earlier. Net mortgage borrowing from the banks fell 0.1% in the year to March, while the outstanding level of unsecured borrowing contracted 1.6% over the same period. The improvement is adding to signs that household are planning to increase their spending as the affordability of mortgage payments increased due to the BoE's 'Funding for Lending' scheme.
BBA statistics director David Dooks said: "The Funding for ending Scheme has made the mortgage market more competitive, allowing smaller institutions to offer attractive rates. But nevertheless the main high street banks still provide 60 percent of new mortgage borrowing. Mortgage approvals edged up back to levels of a year ago and the prospect of more first-time buyers entering the market during 2013 is likely to help mortgage chains in due course.
"As has been the case over the last three years, the prospects for the London market will have an important bearing on overall house price growth in 2013," said Richard Donnell, director of research at Hometrack.
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