Mortgages 'must be addressed in the Emergency Budget'

22 June 2010

Written by Gavin Elley

The lack of funding for mortgages must be addressed by the chancellor of exchequer George Osborne in the Emergency Budget, one organisation has said.

The Intermediary Mortgages Lenders Association (IMLA) has called on the government to provide clarity on its plans to support the home loan market.

With changes in regulations for the banking sector and many institutions repaying support schemes granted by the leaders, there is a possibility the problem may worsen, the body said.

Peter Williams, IMLA executive chairman, commented: "[The chancellor] needs to recognise that we have a mortgage funding problem which is preventing the housing market from making its full contribution to the critical issue of meeting housing demand."

Issues the property market is currently facing include a decline in the supply of abodes, a small number of first-time buyers and limited affordability, the organisation noted, while the rate of arrears and possessions could increase as salaries drop and taxes rise.

However, the Financial Services Authority today (June 22nd) released figures that showed the number of loans in arrears has fallen four per cent in the latest quarter.

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