Govt. injecting money into the economy?

Madders

I'm sure I heard on the news, some three months ago that the Govt had injected a further £80 billion into the economy with an instruction to banks to start lending again to families and small businesses. Is this correct and if so, are banks likely to loosen the purse strings when it comes to mortgage lending?

Thanks.

Madders

ACG

The govt will be lending banks a certain amount of money IF they want it.
Its still going through but ive spoken to a couple of lenders who will be taking them up on the offer.

I know of 2 anyway so in the next month or so i think you will see some movement in the mortgage rates offered. The thing is, nobody knows whether it will be made available to everyone or people with just low loan to values.

CLAPTON

the government has

-told banks to lend more
-to strengthen their capital ratios.. that means lend less
-to lend more to small and medium sized businesses
-to lend more on mortgages

it doesn't require an amazing intelligence to see a problem here

it's interesting that Santander have just raised their mortgage interest rate which seems to imply they don't want more mortgage business.

Thrugelmir

Madders wrote: »

Is this correct and if so, are banks likely to loosen the purse strings when it comes to mortgage lending?

If your question is along the lines will banks return to the lax days of lending of the early 00's. No they won't.

Will this available funding maintain stability in the mortgage. Yes it will.

Without the funding activity across the property market might grind to a halt. As a lack of money restricts activity.

MoneySaverLog

Thrugelmir wrote: »

Without the funding activity across the property market might grind to a halt. As a lack of money restricts activity.

This will have a downward pressure on house prices. Overly priced houses are just going to remain on the market forever, and not get sold until prices drop to a realistic and affordable level where banks are prepared to lend again.