16,000 applicants refused a mortgage each month

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by Kay Murchie

Bank of England figures have revealed that over 16,000 mortgage applicants are being turned down each month.

The figure stood at 12,000 last December but has risen since March.

It is the first time these types of figures have been released by the Bank and highlight that lenders are still picky about who they lend to.

The figures come just a day after the Council of Mortgage Lenders (CML) reported that mortgage lending fell by 58% in the year to May 2009.

Gross mortgage lending totalled £10.3 billion in May, 2% down on the £10.5 billion reported in April, according to the CML. Furthermore, May’s figure is 70% lower than the peak of summer 2007.

Commenting on today’s figures from the Bank of England, Richard Morea, from mortgage brokers London & Country, explains: “It’s much harder for homeowners to be accepted. We’ve seen a complete reversal in the way that mortgage lenders do business.”

“Where before they were looking at reasons why they should grant you a loan, today they are looking at reasons why they shouldn’t.”