Thursday, June 30, 2011

Bank of England says mortgage defaults are on the rise – and that’s before a rate rise.

Bank of England Warns of Rising Loan Defaults

U.K. lenders expect defaults on loans to homeowners and small businesses to rise in the third quarter of 2011, the Bank of England said Thursday.In its quarterly credit-conditions survey, the U.K. central bank said lenders reported that their losses from defaults on home loans rose in the second quarter and the rate of default is expected to increase in the third quarter. Losses on unsecured loans, like credit cards, are also expected to increase in the third quarter, lenders said. Britons are facing an unprecedented squeeze on their finances from a combination of stagnant wages, higher taxes and high inflation. The BOE said lenders had expected the cost of home loans to decrease in the second quarter compared with the first and the availability of loans to rise. In the end, that didn't

Posted by pbahra @ 10:30 AM (1238 views)
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One thought on “Bank of England says mortgage defaults are on the rise – and that’s before a rate rise.

  • “They said demand for loans from small and medium-sized firms “increased markedly” in the second quarter from the first. Banks, who agreed to lend more to small firms under a deal struck with the government, previously said small firms weren’t asking to borrow money. ”
    Is this because small to medium sized firms are expanding, or because they cannot pay the wages to their staff and the firms are no longer economically viable?

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