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Those trying to get a cheap unsecured loan to help pay off their mortgage are finding it increasingly difficult. The housing market continues to go through its slump and although some are able to get a refinance, there is a huge lack of new cheap unsecured loans that are currently available. This issue will affect thousands that are not able to get a remortgage and need to seek a cheap unsecured loan to stay on top of their bills.

Michael Coogan of the CML stated, “The remortgage market remains on track to meet our forecast for growth this year, demonstrating the resilience of the market despite recent bad news. However, by comparison, the next few months will remain very weak for house purchase activity for the funding reasons, which are now well rehearsed. We still await first signs of the Bank of England’s special liquidity scheme indirectly helping to ease the current logjam.”

Howard Archer with Global Insight added, “Very low housing market activity seems certain to feed through to further depress already markedly weakening house prices. Global Insight forecasts house prices to fall by 12% in both 2008 and 2009, before essentially flattening out in 2010. As a result, house prices are seen falling 24% in nominal terms from their August 2007 peak of £199,600 to stand at £152,683 at the end of 2009.”

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