Mortgage borrowing by individuals rose to £5.5 billion in September 2025, the highest since March 2025

Net borrowing of mortgage debt by individuals rose by £1.2 billion to £5.5 billion in September 2025, the highest since March 2025, when it stood at £13.2 billion, according to the Bank of England's Money and Credit release published on 29 October 2025¹. The same release reports that gross mortgage lending was £24.9 billion in September, up from £23.0 billion in August, while gross repayments rose slightly to £20.3 billion from £20.0 billion¹.

The effective interest rate on newly drawn mortgages, described by the Bank as the actual interest paid, fell by 7 basis points to 4.19% in September, the lowest since January 2023 (3.88%), continuing a downward trend observed since March 2025¹. The rate on the outstanding stock of mortgages was unchanged at 3.89%¹. The annual growth rate for net mortgage lending increased to 3.2% in September from 3.0% in August, the highest since January 2023 (3.4%)¹.

On approvals, which the Bank treats as an indicator of future borrowing, net mortgage approvals for house purchase increased by 1,000 to 65,900 in September¹. Approvals for remortgaging, which capture only remortgaging with a different lender, decreased by 600 to 37,200 over the same period¹.

Consumer credit moved in the other direction. Net borrowing of consumer credit by individuals was £1.5 billion in September, down from £1.7 billion in August¹. Net borrowing through credit cards was little changed at £0.7 billion, while net borrowing through other forms of consumer credit, such as car dealership finance and personal loans, fell to £0.8 billion from £1.0 billion¹. The annual growth rate for all consumer credit rose slightly to 7.3% from 7.2%, with credit card borrowing growth up to 10.8% from 10.5% and other consumer credit growth down slightly to 5.7% from 5.8%¹.

Households' deposits with banks and building societies increased by £7.9 billion in September, driven by £5.8 billion into interest-bearing sight deposit accounts, £2.4 billion into ISAs and £0.7 billion into non-interest-bearing accounts, partly offset by £1.5 billion of withdrawals from interest-bearing time deposit accounts¹. The effective interest rate on individuals' new time deposits was 3.82%, up from 3.79% in August, while the rate on the outstanding stock of time deposits fell by 7 basis points to 3.42%¹.

The August figures for net mortgage borrowing, the effective rate on new mortgages and net mortgage approvals are derived from the changes reported for September¹.

Why it matters for households

The figures describe what households collectively did with mortgage and consumer debt in September, and what they paid for it. New mortgage borrowing was higher than in any month since March, and the average rate paid on newly drawn mortgages was the lowest since January 2023¹. That rate applies to new loans agreed in September, not to existing borrowers, whose payments depend on their own deal; the average rate on the outstanding stock of mortgages was unchanged at 3.89%¹.

Approvals for house purchase, at 65,900, indicate the volume of lending agreed but not yet drawn, so they point to borrowing in the months ahead rather than money already owed¹. Remortgaging approvals cover only borrowers switching lender, so they exclude those moving onto a new deal with their existing lender¹. Consumer credit borrowing was lower in September than August, though annual growth in credit card balances rose to 10.8%¹. Households added £7.9 billion to deposits, with £2.4 billion of that going into ISAs¹. The Bank's figures do not break down borrowing or deposits by income, age or region, so they do not show which households are affected.

What happens next

The Bank of England's next Money and Credit release is due on 1 December 2025¹.