Moneyextra makes lender plea

Moneyextra has called for UK banks to resume mortgage lending and return to active duty.

Richard Mason, managing director of Moneyextra, said: “There have been numerous calls for UK banks to encourage lending in recent months, but they appear to have fallen on deaf ears as our banks have seemingly shrugged their shoulders and gone AWOL.

“Even in the last month, the number of mortgage products has decreased by a staggering 15%, with the majority of these being fixed mortgage products which have seen a reduction of nearly a quarter since May 2009.

“It doesn’t make sense and is frankly unacceptable, as one of the key reasons for lender caution has since been removed. Banks initially cut back on lending because of the volatility in the property market which left them uncertain about the value of securities.

"However, given the housing market’s recent stabilisation and a return in consumer confidence, we should be seeing the number of products rise, not fall; there is simply no reason for banks to hold back lending any longer.

“I strongly urge lenders against deserting the UK economy in its time of need, and implore them to increase the flow of lending, especially to first-time buyers; this is critical to prevent the housing market from plunging into a deeper economic abyss.”