The recent trend in the increase in the number of homeowner loans and mortgages being approved for house purchase has continued throughout the month of August, with yet another increase in the number of loans being approved.

Although there was a dip in new loan figures during July, this has corrected itself and the figures for August show an increase in new loans of 81 per cent above the same time last year. This news shows more positive signs for economic recovery and suggests than confidence is continuing to return to the housing and homeowner loan markets, both from lenders and consumers.

Despite an increase in the number of loans for new purchases, the figures for remortgages were still significantly lower than they were twelve months ago, with a 47 per cent decrease in remortgage loans since last August. This is largely due to the currently low standard variable rates which are being offered by lenders on existing loans, making a remortgage an unattractive proposition for many borrowers at the moment.

There has also been a continued decrease in the number of personal loan approvals over the course of the year, due to a lack of loan funding from lenders and a more cautious approach form potential borrowers.

David Dooks of the British Banking Association (BBA) said “The main high street banks’ mortgage lending has stabilised in a market where other lenders are largely inactive. Loans approved for house purchase have recovered t early 2008 levels, but low levels of consumer demand and a limited number of properties coming onto the market will continue to moderate lending. In reaction to the economic conditions, consumers appear to be building up their savings and controlling their appetite for unsecured borrowing”.