20-03-2008
Market difficulties affect small society mortgage lending
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The new mortgage lending business of a number of smaller building societies in the UK has either been restricted, or entirely halted, it has been claimed.
As a consequence of the ongoing difficulties in financial markets, a number of building societies have modified their lending policies, including The Earl Shipton and the Bath, who have both decided to end most of their previous mortgage offers, reports the BBC.
Both building societies now offer mortgage deals at a standard variable interest rate.
"Wholesale money is difficult to get and we have come to a standstill at the moment," said a representative from the Bath Building Society, an organisation with a history extending back over 100 years.
"We are hoping it will just be for a month, but we have taken on so much [new business] we have just run out of money to lend at the moment."
A number of other building societies, including the Newbury and the Tipton & Coseley, have taken the decision to lend only to individuals who reside locally.