UK Prime Minister Gordon Brown meet the leaders of the UK banking industry in a Downing Street summit aimed at solving the crisis in Britain's mortgage market.
The banking industry is still reeling from the problems caused by the ongoing problems in the global money markets. Although the problems first emerged back in August 2007, a torrent of bad news runs the risk of causing a major collapse in the UK housing market. Recent data from leading mortgage bank Halifax indicated that prices had started to decline. In the US, prices have fallen 10% over the past year. A similar decline in the UK is seen as catastrophic given how much personal wealth is tied up in housing stock.
Only last week the Bank of England cut interest rates by a quarter of a point, to 5%. The cut has not been passed on to borrowers.
As well as the mainstream lender much of the market relies on independent mortgage brokers. These act on behald of borrowers. But with the market in crisis it seems lenders have the upper hand.
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