The number of UK mortgage approvals has fallen to a four-month low, according to the latest data from the British Bankers’ Association.
The figures show that number of loans approved for house purchases fell to 44,489 in September, down from 46,567 in August. This is the lowest number since May, when there were 43,153 approvals.
Remortgaging approvals rose 40% for the year, while approvals for house purchases were up 14% from a year ago. Gross mortgage borrowing in September was £12.1bn, a rise of 17% from a year ago.
The overall number of approvals was up 24% on September last year.
The BBA said this rise was partly due to first-time buyers finding good deals and existing borrowers switching to lower fixed rates to control their mortgage costs.
The figures also showed that net credit card lending and lending for personal loans and overdrafts were down in September from August.
Richard Woolhouse, chief economist at the BBA, said: “Borrowing figures in the mortgage market remain strong as customers take advantage of record low interest rates. In particular, remortgaging remains high as savvy customers secure attractive deals ahead of a possible rate rise.
“Credit card purchases were 6% higher last month than a year ago. Buoyant consumer confidence and rising wages may well be playing a role here.”
Charlotte Nelson, finance expert at Moneyfacts.co.uk, said: “By remortgaging to a new fixed-rate now, borrowers are not only securing low monthly payments today, but are buffering themselves from any future rate rises.
“With base rate now unlikely to rise until mid-2016 there is still time for many borrowers to capitalise on these low-rate deals, perhaps by choosing to opt for a longer term fixed rate to ensure they benefit from this rate drop long into the future.”
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