First Direct pull mortgages

First Direct today announced that it was to withdraw its mortgages for new customers after receiving five times as many applications as it normally received. The news is seen as further evidence that the credit crunch is starting to take affect.

Shortly after First Directs announcement the Co-operative Bank pulled its 2 year rate mortgage deals while the Royal Bank of Scotland, Natwest and Kent Reliant Building Society raised their variable rates for existing mortage holders.

The above situation has arisen as banks and building societies are finding it much harder to raise money from credit markets for mortgages.