Building society only lending local

Black Country building society minnow Tipton & Coseley today announced it will only lend to local people.

The move follows the society being inundated with calls from would-be borrowers across the UK.

It is seen as yet another result of the credit crunch, ratcheting up the pressure on lenders who are struggling to secure funding after wholesale money markets effectively dried up, forcing lenders to hike their rates or even stop lending altogether.

Tipton & Coseley, which has recently featured in best buy tables, is one of a decreasing number of lenders still prepared to advance 95 per cent of a property’s value to first-time buyers.

Chief executive Chris Martin said: “We were getting a lot of calls from around the country and we wanted to make sure that people locally can get them.

“Lenders are withdrawing rates and increasing them and limiting the percentage they will lend on. We are a bit loth to do that and it is to make sure we don’t have to, that we are restricting borrowing to people in our area.”

The society has also pulled out of the intermediary market, selling its mortgages through third parties.

The move is seen as yet another result of the credit crunch, which has seen the Bath Building Society and Earl Shilton Building Society withdraw all of their home loans, except their standard variable rates.