Will More Credit Stop Repossessions

The Bank of England announced today that  more credit will be made available to households and businesses over the next three months. This surely has to be good news for first time buyers and home owners struggling to remortgage their property? Not neccessary, even though around 15% more banks and building societies said they expected a small increase in lending to households during the second quarter of 2009.

The first rise in lending since September 2007 might be too little too late to stop house repossessions and little consulation for the many property owners on the brink of being repossessed. Increases in bank lending grab headlines during an unprecidented period of credit crunch, but the devil is still in the details. Who will benefit form the increase in lending and on what terms?

Property owners with little or negative equity will still find it hard to remortgage and first time buyers with small or no deposits will still find it difficult to get a mortgage.

Todays announcement of a samll increase in lending will not make a difference to the people that need it most but can't get a loan or a mortgage. Nothing has changed to those people faced by repossessions.