Recent trends in the lending market indicate a decline in secured loan approvals from traditional banks. This shift has led more people to turn to independent lenders for their financial needs. The Bank of England recently reported a drop in secured loan approvals from June 2014 to September, hitting their lowest level in two years. As a result, independent lenders like Loan.co.uk have become more popular due to their flexible borrowing policies, which offer people more affordable options.
Understanding the Current Housing Market
The speed of Britain’s housing market has slowed significantly recently, according to the Bank of England. There are still concerns about a potential housing bubble, which has been addressed with new legislation aimed at curbing risky lending practices. Interest rates fell to 3.18 percent in October, a slight decrease from September. Mortgage approvals hit their lowest point in 16 months. Halifax also reported that housing prices have dropped dramatically over the past two years and experienced the weakest growth within that period.
Banks Becoming Cautious, Independents Growing
Due to the challenging statistics from the current housing market and the new regulations aimed at managing risky homeowner loans, banks have become more cautious. Some critics believe this caution is overdone. On the other hand, the job market is improving with rising average salaries, increasing disposable income, and making it easier for people to manage loans secured against their properties. Banks have particularly focused on reducing loans that extend into retirement, contributing to the decline in loan approvals in recent years.
Key Takeaway
This conservative approach by banks, considered overly strict by some, has provided an opportunity for independent secured loan lenders to offer a viable alternative to traditional banks. It is essential to choose a reliable lender and gather all necessary information before committing to a loan. With proper knowledge and preparation, you can secure a favorable interest rate.