Lenders becoming ‘far more stringent’

Money lenders around the UK are becoming far more stringent as debt management problems mount for millions of consumers, it has been suggested.

The tightening of lending criteria has been particularly sharp in the home loan sector, with would-be mortgage borrowers finding it increasingly difficult to secure a deal, according to MoneyExpert.

In fact, research by the price comparison firm shows that 60 per cent more mortgage applications are being rejected now than was the case six months ago.

Part of the reason is believed to be heightened debt management difficulties among homeowners across the UK after the base rate of interest was increased five times in 11 months.

Sean Gardner, chief executive of MoneyExpert, said: “Life is tough at the moment if you’re applying for a mortgage.

“The financial environment is far more stringent than in the summer of last year and people need to be prepared for rejection.”

Earlier this year, the Consumer Credit Counselling Service warned that British homeowners would be “on the rack” financially throughout 2007.