/24-7PressRelease/ - LONDON, UK, April 03, 2008 - Many small building societies have either restricted their lending or totally halted the fresh mortgage plans. These societies have been inundated by large number of loan applications as bigger lenders found funds hard to come by from the money markets that are already facing the credit squeeze.
The building societies like the Bath and the Earl Shilton have completely withdrawn their mortgage offers except for their standard variable rate mortgages. The Bath said that it has simply run out of money to entertain its customers. Other building societies like the Newbury, Melton Mowbray and the Tipton & Coseley are lending only to the local people.
The Bath building society conceded that it had too many customers to deal with. Its chief executive Dick Jenkins said: "We have simply been inundated with mortgage applications and inquiries in the last few weeks. We want to preserve the level and quality of service we offer our customers and we simply can't do that if we have far too many applications to process."
The sub-prime collapse in the U.S. has globally affected the credit situation. In the UK, the credit crunch was evident from the last quarter of 2007. The situation has more or less remained tight in the UK as far as credit availability is concerned. The BoE has recently pumped money in the markets to boost the slowing economy and revive the credit availability.
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