Mortgage approvals fall on introduction of tighter lending rules

Billy Ehrenberg
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Mortgage approval rates saw an overall drop in the month of May (Source: Getty)

Mortgage approval rates showed an overall drop in the month of May, according to new data.

Figures from the British Bankers' Association show that the combined figure of loans for purchase, for remortgage and other secured lending, was down both on last month and on May of last year.

The fall is a relatively small one however and it is important to note that the figures are not seasonally adjusted.

While the total number of mortgage approvals is down, the number of approvals for house purchases has risen by 4.2 per cent, a similar rate to the 3.2 per cent increase seen this time last year.

Approvals for remortgaging and other secured loans have decreased significantly however, by 17.7 per cent and 27.9 per cent respectively. Both areas grew modestly a year ago.

These figures must be viewed with some caution: while they could show the first signs of the mortgage market responding to new Mortgage Market Review (MMR) rules they could also be a one-off and approvals could rise again next month.

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