Home-owners reduce mortgage debt

Prudent home-owners shaved a record £15.4bn off their mortgage debt in the second quarter of this year as ultra low interest rates helped them pay down what they owe.
By The Newsroom
Published 3rd Oct 2013, 01:01 BST

The latest figure marks the highest quarterly net injection of housing equity recorded in the Bank of England’s series, which goes back to 1970, as well as the 21st consecutive quarterly net injection of cash as the flow of mortgage lending remains weaker than the amounts being ploughed back.

Rock bottom mortgage rates and poor returns on savings have made it more attractive for people to use any spare cash they have to pay down their mortgage debts.

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The figures, which are published on the Bank’s website, show the total net injection of mortgage repayments since summer 2008 has topped £209bin. The latest quarterly total follows a net housing equity injection of £13.4bn in the first quarter of this year.

Separate figures recently released by the Bank show the typical interest rate taken out by borrowers on a new mortgage dropped in the second quarter to a new low of 3.47 per cent.

Related topics:Bank of England