Mortgage approvals fall to 53,400 as remortgaging rises in September

UK mortgage approvals for house purchases fell to 53,400 in September 2026, down from 54,800 in August, according to figures published by the Bank of England on 29 October. Approvals for remortgaging with a different lender moved in the opposite direction, rising to 42,600 from 34,000.

The Bank’s Money and Credit release also recorded a decline in net mortgage borrowing to £3.9 billion, compared with £4.2 billion in August. September’s total was below the £4.9 billion average recorded over the previous six months.

What changed in September’s mortgage approvals and lending?

The Bank reported that house-purchase approvals were below their previous six-month average of around 58,800. Its approvals figures are net of cancellations, while the remortgaging measure excludes borrowers taking a new deal with their existing lender. The increase therefore describes activity involving a change of lender, rather than the whole refinancing market.

Gross secured lending rose to £24.2 billion in September from £23.7 billion in August, according to the Bank. Despite that increase, the total remained below the previous six-month average of £26.3 billion, showing that the monthly rise did not bring lending back to its recent average level.

Repayments also increased, reaching £21.4 billion against £20.2 billion in August. The Bank’s figures put September’s repayments slightly above their six-month average of £21.3 billion.

The Bank cautioned that subtracting repayments from gross lending does not produce the published net lending figure. Different seasonal adjustment methods are applied to the series, so the three totals cannot be treated as a simple accounting calculation.

Annual growth in net mortgage lending slowed to 3.4% in September from 3.6% in August, the Bank reported. This measures the pace of growth over a year, rather than the amount borrowed during the month.

How do borrowing costs and household finances compare?

The effective interest rate on newly drawn mortgages increased to 4.63% in September from 4.60% in August, according to the Bank. The rate on the outstanding mortgage stock also rose, reaching 4.03% from 4.00%.

The September figures precede the October changes in advertised deals reported by Moneyfactscompare.co.uk. Its separate update recorded selected fixed mortgage rate cuts after the five-year average reached 6% on 5 October. Those figures concern a different period and measure from the Bank’s September lending data.

Moneyfactscompare.co.uk has also reported a 13-day shelf life for UK mortgage deals as lenders changed rates and withdrew products. That report concerns how long deals remained available, rather than the number of mortgage approvals recorded by the Bank.

Beyond mortgages, the Bank recorded £1.9 billion of net consumer credit borrowing in September, down from £2.7 billion in August and below the previous six-month average of £2.1 billion. Credit card borrowing accounted for £0.7 billion, compared with £1.3 billion a month earlier. Other consumer borrowing, including personal loans and car dealership finance, fell to £1.2 billion from £1.4 billion.

A lower monthly flow did not mean slower annual growth across all consumer credit. The Bank reported that the annual growth rate edged up to 9.8% in September from 9.7% in August, distinguishing the latest month’s borrowing from the longer-term movement in balances.

Households added £4.7 billion to deposits with banks and building societies in September, following £4.9 billion in August, according to the Bank. Within September’s total, £5.0 billion flowed into individual savings accounts, partly offset by withdrawals from other account types. These aggregate figures do not identify how much was being saved for home purchases.

How does the Bank interpret these measures?

The Bank describes its effective mortgage interest rate as the interest actually paid. The newly drawn mortgage measure therefore concerns borrowing that has been taken out, while the outstanding-stock measure covers existing mortgage balances; neither is simply a list of rates currently advertised to applicants.

The Bank said its policy committees use the monthly borrowing and deposit statistics to assess economic developments and trends in the UK banking system. The release is a statistical publication, rather than an announcement of a mortgage pricing decision or a recommendation to borrowers.

What do the figures indicate about future borrowing?

The Bank identifies house-purchase approvals as an indicator of future borrowing, giving September’s decline significance beyond lending already completed that month. However, the release does not forecast how many approved purchases will proceed or set out a projected path for mortgage rates. Its September reporting period also means it cannot establish the effect of the subsequent October changes in mortgage deals.