Homeowners 'cut back on borrowing to pay for mortgages'

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Homeowners in the UK are cutting back on borrowing and credit card debt in order to meet mortgage and other property payments, according to new research.

The findings by Alliance & Leicester also revealed that people occupying rented accommodation have fewer concerns about borrowing money than those with mortgages to pay.

Discussing the findings, the business's strategic planning director Sean Murphy said even though average interest rates on unsecured loans have fallen, household budgeting has put families under some pressure.

He added: "The continued growth in mortgage borrowing masked a big change in the behaviour of mortgage borrowers in other areas of their personal finances as they felt the pressure of higher rates.

"With the next move in base rates now seen as more likely to be downwards, this could bring them some welcome comfort."

The research by Alliance & Leicester has been released several days after figures from the Council of Mortgage Lenders revealed that the amount of money lent as mortgages fell in September.

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