Credit crisis: mortgage conditions set to get worse, says Bank of England

By Harry Wallop and Myra Buttwerworth Banks and building societies are expected to squeeze home buyers even more over the next three months, according to an authoritative report. Lenders have told the Bank of England that they will cut down the number of home loans available over the summer. The findings emerge from the Bank's Credit Conditions report, which is a comprehensive survey of banks and building societies' outlook for the next few months and their experience of the past three months. The amount of unsecured lending, such as overdrafts and credit cards, is also expected to fall. Worryingly, the report shows that the number of home owners defaulting on their mortgages has risen by more than lenders expected, as rising household bills make it impossible for some to meet their mortgage payments. In December just 1 per... [read full story]