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TODAY'S OTHER NEWS

Mortgage lending leaps 25% in a year

Mortgage approvals leapt 24% in the year to September driven by a resurgence in remortgaging.

Remortgages jumped 40% over the year, against a 14% rise in house purchase approvals.

Latest figures from the British Bankers' Association showed that gross mortgage borrowing in September was £12.1 billion, 17% higher year-on-year.

Jonathan Harris, director of mortgage broker Anderson Harris, said borrowers are rushing to take advantage of cheap mortgage deals to protect themselves against a rise in interest rates.

But he said the trend may now slow. “With Mark Carney, governor of the Bank of England, now suggesting that rates rises are a ‘possibility not a certainty’, it remains to be seen whether borrowers will lose the urge to remortgage.”

Harris said that fixed rates are likely to remain competitive. "Lenders are keen to lend and have plenty of funds to do so. As we move towards the end of the year it is possible that we could see some exceptional deals as banks look to meet their targets for the year.”

Charlotte Nelson, finance expert at Moneyfacts.co.uk, said that fixed rates have fallen “quite dramatically”.

The average two-year fixed rate mortgage is down from 3.51% a year ago to 2.75% today, while five-year fixed rates fell from 4.08% to 3.29% over the same period.

Nelson said: “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.”

Richard Sexton, director of e.surv chartered surveyors, said the housing market has much more energy than last year thanks to the recent growth in small deposit lending. “Low interest rates are encouraging borrowing across all aspects of the market, and pushing up remortgage approvals in particular.

“As a rate rise again becomes a matter of debate, it is the ideal time for borrowers to search for the best deals.”

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