How does a bank work? In very simple terms, a bank collects deposits from savers, and lends the money to borrowers. It pays interest on the deposits, charges a higher rate of interest on what it lends, and keeps the difference as profit.

More ‘bad’ news for the housing market yesterday. Surveyors are writing smaller numbers on the top of their housing valuation reports.

The credit crunch is set to get even worse. In a week where we’ve seen some lenders pull out of the mortgage market altogether – if temporarily – and others raise interest rates substantially in the hope of putting off customers, many borrowers may be wondering how much worse it could get.