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Banks Get Moving With Government Lending Schemes

Written by Sam Jones on 07 September 2013.

We are pleased to reveal the Government’s flagship scheme to boost lending has finally started to have a major impact with net lending to homeowners and businesses in the second quarter of 2013 growing by £1.6bn.


It means £1.6bn more loans were dished out than redeemed in the same period, effectively meaning more money is moving into the economy.

Since the funding for lending scheme launched in August 2012 it has seen a disappointing six months when net lending has fallen significantly.


Net lending was negative £2.4bn in the fourth quarter of 2012 and a negative £1.8bn in the first quarter of this year. It edged £39m into positive net lending in the third quarter of 2012 but nothing on the scale of this year’s boost.

The falls mean the funding for lending scheme still has to increase net lending by £2.3bn for it to get back to the position it started in.

Lending has now begun to turn the corner with lenders taking advantage of cheap loans from the Bank of England and passing them on to borrowers.

We are delighted to see the UK’s biggest lenders really boosting lending to customers with Nationwide Building Society leading the way with a massive £2.3bn net lending.

In a distant second was Lloyds Banking Group with net lending of £1.3bn while Virgin dished out an extra £738m than it took in, closely followed by Barclays and Coventry Building Society.

We believe this is great news for mortgage borrowers as more money becomes available to buy and move homes.
Higher volumes of mortgage lending should lead to greater competition between lenders on rates and easing of criteria.

Lenders have already been slashing rates to record lows on the back of low Bank of England base rates and cheap funding costs.

With the funding for lending scheme now having a bigger impact it could mean the second half of 2013 is a unique moment when rates are loan and lending is growing.

Capital Fortune believes this is potentially a good opportunity to get your foot on the housing ladder or take the plunge and move home.

After years of falling lending the time is more right to look again at the UK housing market, which is looking increasing in more robust health.

We see the economic data showing house prices appearing stable nationally and growing rapidly in London and the south east.There are also increasing signs of a sustained UK economic recovery after years of stagnation and recession.

The Government isfurther investing heavily in the UK housing market with building programmes and the Help to Buy scheme to help with deposits.

The latest lending figures adds to the growing confidence among homeowners and greater sense of optimism in UK property.

As a buy-to-let investment, first home purchase or scaling up to your dream house our mortgage brokers are here to help.

We can explain the complexities of the rapidly changing market and scour the  deals for you, potentially saving thousands of pounds over your mortgage term.

Wiith today’s super-low rates and more lending we will seek to add value to your choice with expert, qualified and regulated mortgage advice.

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