Mortgage equity withdrawal
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Mortgage equity is still increasing according to the latest surveys. Homeowners have stopped using their homes as “cash machines” and are still increasing their financial stake in their homes.
Figures from the Bank of England show that homeowners’ equity rose by another £6.2bn in the second quarter of 2010.
From July 1998 to March 2008 homeowners had borrowed an extra £328bn against the rising value of their homes, in a process called mortgage equity withdrawal. This reversal in the trend clearly means adverse affects for consumer spending. Read more here.
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