Credit card borrowing falls as mortgages increase
Published On 21 August 2007
While mortgage lending remained robust credit card borrowing continued to decline in July, new figures show.Data released by the British Bankers' Association (BBA) showed that underlying credit card borrowing fell by £100 million in the month.
In contrast, net mortgage lending increased by 5.7 billion - more than in the previous two months, when it rose by 5.4 billion each time.
Similarly, borrowing on loans and overdrafts increased, rising by £200 million over the month.
David Dooks, the BBA's director of statistics, commented: "Longer-term trends in mortgage lending are little changed but July's strong rise was surprising, given the expected cumulative impact of higher interest rates.
"This resilience shows the popularity of home ownership and also reflects more remortgaging activity.
"Consumers' borrowing on cards again fell and personal loan and overdraft demand remained subdued because household finances have tightened."
Figures from Credit Action show that consumer debt in the UK increased by £107 billion in the year to the end of June.
