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Mortgage lending at record high

Mortgage lenders are handing over more money than ever before, the Council of Mortgage Lenders (CML) has announced.The CML reported an all-time high gross mortgage lending sum of £34.2 billion in June - up from £31.4 billion in May.The rise is a result of hikes in interest rates and high house price inflation, but belies the fact that the CML, the Building Societies Association (BSA), and the British Bankers' Association (BSA) have all released figures indicating that the property market is slowing down.CML director general, Michael Coogan, said: "There are signs that the market is feeling the cumulative effects of the five interest rate rises we have seen over the past year."This effect will become much more evident in the coming months as borrowers with fixed-rate mortgages come off their existing deal into a significantly higher interest rate environment."The amount of money being borrowed may be higher than ever, but lending itself rose by just nine percent from May to June, down from 12 percent in 2005 and 15 per cent in 2006 and the BSA released data showing a dramatic fall in the number of mortgage approvals. Brian Morris, of the BSA, warned: "Borrowers should be careful about overstretching themselves at this time of rising interest rates and take on new borrowing only if they are sure they can afford to service it."

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