Crosby review recommends lending measures

Britain's mortgage market will not return to normal for at least another two years, according to a government-commissioned report published today (July 28th).

Sir James Crosby, the former chairman of HBOS, led a review of the country's crisis-hit financing market and said that it was inevitable that lending problems would affect house prices.

The review recommended temporary support from the government to help stimulate the mortgage-backed securities market, which have frozen amid the credit crunch.

Responding to the findings, the Council of Mortgage Lenders (CML) director general, Michael Coogan, agreed that intervention is necessary.

He said: "Today's analysis at last sets down an independent welcome marker that intervention to address the mortgage funding gap is both appropriate and necessary.

"Without action, the situation in the housing market will be worse than it needs to be."

Last week, the Financial Services Authority welcomed anti-fraud measures that the CML is currently taking to crackdown on mortgage lending fraud.

Mortgages News posted on 29/07/2008 13:52:00