New record for mortgage lending in June

Mortgage lending hit a record level of £34.2 billion in June, compared to £31.4 billion in May, the Council of Mortgage Lenders (CML) has revealed.

The council said that this degree of activity was attributable to seasonal effects and a response from borrowers to interest rate rises.

As autumn approaches, the CML said it expected strong levels of lending to continue, although the mix of transactions is expected to show more take-up of remortgage deals as people look to minimise 'payment shock'.

Michael Coogan, director general of the CML, commented: "Despite the record level of mortgage lending, there are signs that the market is feeling the cumulative effects of the five interest rate rises we have seen over the past year.

"This effect will become much more evident in the coming months as borrowers with fixed-rate mortgages come off their existing deal into a significantly higher interest rate environment."

Mr Coogan asked the Bank of England to "carefully assess" the impact that another rate rise this year could have and advised borrowers to think about how they will afford repayments if their fixed-rate deal is due to end in the coming months.

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