Funding For Lending to be re-focused away from mortgage lending

ColdIron

Breaking news but this might be good news for interest rates, I shan't count my chickens though

https://www.gov.uk/government/news/bank-of-england-and-hm-treasury-re-focus-the-funding-for-lending-scheme-to-support-business-lending-in-2014

innovate

Good news for savers, not so good news for mortgage holders.

Freecall

http://www.standard.co.uk/business/business-news/housebuilders-dumped-in-panic-as-bank-of-england-tries-to-rein-in-mortgage-lending-8969585.html

standinman2009

Let's hope this means better rates for savers !

le_loup

Good news for people on this part of the board!

grey_gym_sock

i'm not so sure that this will help savers. cheap funding for banks/BSes via FLS will continue, which is what has been keeping savings rates so low.

it may mean that mortgage rates go up a bit, if FLS succeeds in encouraging banks to lend more to SMEs rather than to households.

Rollinghome

innovate wrote: »

not so good news for mortgage holders.

Casualties of the bonkers Help to Buy scheme which has presumably led to the necessity for this move. If mortgage rates do move up, as it seems they will, the biggest casualties could be those encouraged to use the scheme.

opinions4u

If the same amount is being channelled in to the scheme, I can't see it affecting savings rates at all.

The banks will lend to businesses instead of home buyers.

ColdIron

opinions4u wrote: »

If the same amount is being channelled in to the scheme, I can't see it affecting savings rates at all.

I take your point but if there is still demand from house buyers via HTB, perhaps at reduced levels due to some mortgage rate increases, will the banks still not need need to find cash from somewhere to loan to them?

I don't know the answer to this, but one thing is sure, part 1 of FLS will still run unchanged to 2014 so nothing will happen very quickly

opinions4u

ColdIron wrote: »

I take your point but if there is still demand from house buyers via HTB, perhaps at reduced levels due to some mortgage rate increases, will the banks still not need need to find cash from somewhere to loan to them?

I don't know the answer to this, but one thing is sure, part 1 of FLS will still run unchanged to 2014 so nothing will happen very quickly

They'll just reduce their mortgage lending.

Glen_Clark

The warnings against Help to Bubble have grown so loud that even Osborne and his £850k+++ stooge Carney have been forced to ackowlege them. Whether they will do much about them is another matter. Osborne's core voter in Tatton is obsessed with their house price!!