Growing Remortgage Market: Lenders Must Act Responsibly

10.44.00am BST (GMT +0100) Fri 23rd Apr 2004

Responding to today's Datamonitor survey, which shows the remortgage market has grown by 255% since 2000, Malcolm Bruce MP, Liberal Democrat Shadow Secretary of State for Trade and Industry, said: "Lenders must act responsibly. If interest rates rise further, borrowing against house valuations that may not be sustainable will result in catastrophe for thousands."

"With lenders increasing the income multiples that form the basis for lending decisions there is no sign of financial institutions acting with responsibility."

"Making the most of low interest rates is one thing. But borrowing to the edge of your means, seeing interest rates rise and losing your home is hardly making the most of your assets."

ENDS

Notes

Todays's Datamonitor survey shows that the remortgage market has grown by 255% since 2000, and was worth an estimated £121 billion by the end of 2003. Datamonitor claim the average value of a remortgage loan has increased from £61,000 in 2000 to £80,232 at the end of 2003. Remortgaging accounts for more than 45% of total advances and that this is set to grow 48% by 2008, when the market would be worth around £170billion.