The default rate and losses on secured loans to households were reported to have continued to fall, according to the lender survey, the Bank of England Credit Conditions survey.
Default rates on unsecured loans to households have also improved and fell for the fourth consecutive quarter and lenders also predict default rates on credit card lending will fall further in Q4.
Losses given default in Q3 rose unexpectedly for credit card lending, but fell unexpectedly for non credit card lending. Losses given defaults for unsecured lending were expected to fall slightly in Q4.
Bernard Clarke, spokesman at the Council of Mortgage Lenders said the lender survey reflects CML figures.
“The low interest rate has been key and we have already revised downwards our repossession forecasts for 2010, but there was decisive intervention at an early stage including the interest rate cuts.”
He added: “It’s also been the result of a conscious effort from lenders and borrowers to deal with payment problems at an early stage supported by the raft of government initiatives we hope will continue.”
