On mortgages, Adrian Coles, director-general of the Building Societies Association, commented: “Gross lending was £4.1 billion, compared to £4.6 billion in November last year. This cooling of activity since 2006 is likely to be a consequence of higher Bank Rates and a tightening of credit conditions more generally.”
Coles urged holders of fixed rate mortgages that will be ending in the new year to use the Christmas period to start thinking about their new mortgage. He said: “People coming off a fixed rate in the new year are potentially looking at a big increase in their mortgage repayments. As a consequence, it is important they begin to consider their options to help make their repayments as low as possible when their fixed rate period finishes.
“Borrowers should follow this four point action plan:
1. Talk to your existing lender regarding your mortgage options
2. Review your other financial commitments in the light of possibly increased mortgage repayments
3. If you envisage any repayment problems talk to your lender as soon as possible
4. Make any necessary arrangements to ensure that your finances are in good shape.
“It may not be much fun, but a few hours invested over the holiday period sorting out your mortgage could pay dividends in the new year, and ensure that you will be able to have a happy Christmas in 2008 as well as in 2007.”
Building societies attracted £2.3 billion of savings inflows in November, almost three times the amount received in the same month last year. Until September of this year the figure would have been a record.
Commenting on the figures, Coles said: “In the last three months building societies have received new deposits of roughly the same value as they received in the entire twelve months of 2006.
“Building societies continued to attract record inflows in November, albeit slightly reduced from the extraordinarily high figures of September and October. Much of these savings are likely to come from further withdrawals from Northern Rock bank. They also reflect the attractive rates of interest on offer at building societies which are encouraging people to save.
“A perception of a possible change in the economic environment may also mean that greater attention is being given to savings these days.”
Building Society Statistics November 2007
Building societies had net receipts of £2,348m in November 2007 compared to net receipts of £848m in November 2006, almost three times the inflow.
Building society net receipts to cash ISAs were £56m in November 2007, compared to £35m in November 2006.
Building society gross advances amounted to £4,090m in November 2007, compared to £4,597m in November 2006
Net advances were £742m in November 2007, versus £1,232m in November 2006
Approvals were £4,238m in November 2007 down from £4,365m in November 2006
