Net mortgage borrowing fell to £4.1 billion in January 2026

Net borrowing of mortgage debt by individuals decreased to £4.1 billion in January, from £4.5 billion in December, the Bank of England said in its Money and Credit release published on 2 March 2026. The January figure was below the previous six-month average of £4.5 billion¹.

Net mortgage approvals for house purchases, which the Bank describes as an indicator of future borrowing, decreased to 60,000 in January, from 61,000 in December, and below an average of around 64,100 over the previous six months. Approvals for remortgaging, which only capture remortgaging with a different lender, decreased slightly to 38,100 in January from 38,400 in December¹.

Secured gross lending increased slightly to £23.4 billion in January, up from £23.0 billion in December and still slightly below the six-month average of £23.8 billion. Repayments rose to £19.1 billion from £18.8 billion, below the six-month average of £20.0 billion. The Bank notes that the difference between gross lending minus repayments and net lending figures is due to varying seasonal adjustment methods applied across these series¹.

The effective interest rate, the actual interest paid, on newly drawn mortgages decreased to 4.09% in January from 4.15% in December. The rate on the outstanding stock of mortgages was 3.90% in January, down from 3.92% in December¹.

"Net borrowing of mortgage debt by individuals decreased to £4.1 billion in January, from £4.5 billion in December, below the previous 6-month average of £4.5 billion."

Other household borrowing moved differently. Net borrowing of consumer credit by individuals increased to £1.8 billion in January, from £1.7 billion in December, in line with the previous six-month average of £1.8 billion. Within this, net borrowing through credit cards was £0.9 billion, up from £0.8 billion, while net borrowing through other forms of consumer credit, such as car dealership finance and personal loans, remained unchanged at £0.9 billion¹.

Bank of England measure, January 2026	January	December
Net mortgage borrowing	£4.1bn	£4.5bn
Net mortgage approvals for house purchases	60,000	61,000
Remortgaging approvals	38,100	38,400
Net consumer credit borrowing	£1.8bn	£1.7bn
Effective rate on newly drawn mortgages	4.09%	4.15%

Source: Bank of England, Money and Credit, January 2026¹

The effective interest rate on interest-charging overdrafts increased by 71 basis points to 22.03% in January. The effective rate on new personal loans to individuals increased to 9.03% from 8.78%, and the rate on interest-charging credit cards increased to 21.75% from 21.56%¹.

Households' deposits with banks and building societies increased by £4.2 billion in January, following net deposits of £4.5 billion in December. This was driven by households depositing an additional £5.2 billion into ISAs, £3.1 billion into non-interest-bearing accounts and £2.5 billion into interest-bearing sight deposit accounts, partially offset by withdrawals of £0.8 billion from interest-bearing time accounts¹.

Why it matters for households

The figures describe what households did with their borrowing and saving in January, not what any individual should do. Net mortgage borrowing of £4.1 billion was lower than December's £4.5 billion, and the number of approvals for house purchases fell to 60,000, which points to fewer new mortgages being agreed at the start of the year¹.

For anyone with an existing mortgage, the effective rate on the outstanding stock edged down to 3.90% in January from 3.92% in December, while the rate on newly drawn mortgages fell to 4.09% from 4.15%. These are averages across the stock and across new lending, so they do not set the rate on any particular deal¹. Our pages on average mortgage interest rates and on how much UK households owe set out the Bank of England series behind these numbers.

On unsecured borrowing, consumer credit grew by £1.8 billion in January, in line with the six-month average, with credit card borrowing at £0.9 billion. The effective rate on interest-charging credit cards rose to 21.75% and on interest-charging overdrafts to 22.03%, so the cost of existing card and overdraft balances moved up on these measures¹. Households also paid £5.2 billion into ISAs during the month¹.