Bank of England survey welcomed by CML

A Bank of England survey into credit conditions has been welcomed by the Council of Mortgage Lenders.

The report contained what the CML described as "noticeably positive" points, such as a lower number of defaults on secured loans than had been anticipated.

Increased demand in the housing market was also forecast, contrary to many recent reports which have predicted a slump based on rising interest rates.

The survey was undertaken before the recent Northern Rock credit crisis hit the news, although the CML believers that this would not have fundamentally affected the Bank of England''s conclusions.

Spokesman Michael Coogan said: "The funding constraints arising from the slowdown in the interbank lending market were already apparent.

"Against this backdrop, it is encouraging to see that the lenders contributing to the Bank survey largely expect the supply of mortgage lending to hold up."

Northern Rock was forced to turn to the Bank of England for a loan after a crisis in the US mortgage market caused repercussions worldwide.

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