Mortgage borrowing falls to £4.3bn in October

Latest Bank of England data has shown that mortgage debt fell back to £4.3 billion in October, after a rise to £5.2 billion in September..

The data shows that gross lending slightly decreased in October, to £24.5bn from £24.8bn, with gross repayments increasing by £1.5 billion to £22.1 billion in October.

Net mortgage approvals for house purchase decreased by 600 to 65,000, while approvals for remortgaging fell by 3,600 to 33,100, the lowest since February 2025 (32,900). Mortgage approvals for house purchase decreased by 600 to 65,000, while approvals for remortgaging fell by 3,600 to 33,100, the lowest since February 2025 (32,900).

Borrowing of consumer credit by individuals decreased for the second consecutive month, to £1.1 billion in October from £1.4 billion in September. Within this, net borrowing through credit cards slightly decreased, to £0.6 billion from £0.7 billion. Net borrowing through other forms of consumer credit was £0.5 billion in October, down from £0.7 billion in September.

Rachel Springall, Finance Expert at Moneyfactscompare.co.uk, said “Borrowers may well have felt indecisive over securing a mortgage during October, with net mortgage approvals falling for both house purchase and remortgaging. However, the slowdown of activity came at a time when many borrowers felt uncertain surrounding the outcome of the Budget, and now that it’s been revealed, activity could pick up as we edge closer to the year end.

“Lenders will have their own targets to hit and will no doubt be working hard to entice new business, which has been evident over the past month. During November, the Moneyfacts Average Mortgage Rate dropped below 5%, and remains below, great news for borrowers looking for a new deal. However, not every borrower will move lenders when they come to remortgage, but it is expected many will need to make a decision soon if they are coming offer a cheap fixed rate from five years ago. With this in mind, it is worth noting that the Bank of England approval data for remortgaging only captures those with a different lender. Now is a great time for anyone looking for a new deal to seek advice from a broker to assess the latest options.”

Simon Trevethick, Head of Communications at StepChange, said “Last week’s Budget may have prompted some people to pause financial decisions amid uncertainty over potential changes. After a turbulent few years, it’s understandable that consumers remain cautious about mortgage borrowing.

“With December now here and attention turning to Christmas, we expect consumer credit borrowing to pick up as people look to fund the festive season. Our new YouGov polling shows that 8% of British adults who will struggle to afford Christmas plan to rely on credit—that’s around 4 million people.

“For many, financial pressure and debt problems can surface at this time of year. We urge anyone considering credit to plan carefully and explore ways to enjoy a joyful Christmas without risking financial difficulty. And remember, it’s never too early to seek free, impartial debt advice if you’re worried, whether now or in the New Year.”