Record low for mortgage approvals

The figures for March represent the lowest level since the current records began in January 1999, and showed a drop of 44% on the figures for the same month in 2007.

"The news that mortgage approvals dropped to a record low of 64,000 is hardly surprising given that lenders have been aggressively scaling back on the provision of finance to homebuyers," said Simon Rubinsohn, chief economist at the Royal Institution of Chartered Surveyors (Rics).

The number of loans approved for remortgaging was also down 11,000 in March, from the previous month at 98,000, according to the Bank of England. Loans for other purposes were also down; buy-to-let loans were notably down from 63,000 in the previous month to 57,000.

With net lending secured on homes at £6.9bn, the annual growth rate was down from 9.4% in February to 9.1% in March.

The bank announced a plan that would let lenders swap potentially risky mortgage debts for secure government bonds last week, in an attempt to ease the banking concerns and increase confidence in the financial markets.

See £50 billion help from the Bank of England for further information on the governments plan.

The decision was intended to help lenders operate during the global credit squeeze, however, since the plan was announced lenders have continued to withdraw mortgage offers for new customers.

Nationwide are the latest to make the headlines, with their announcement that all but two of their mortgage plans would require a 10% deposit from 1 May.

"The Bank of England's Special Liquidity Scheme, if it works, might stop things getting much worse. But lenders will remain cautious," said Vicky Redwood, UK economist at Capital Economics.

March did however see an increase on the February figures for credit card lending, and other lending through loans and overdrafts, according to Bank of England figures.

However, the leap that was seen between January and February was not quite matched. Credit card lending rose by £400m, which was in line with the previous leap, but other loans and advances increased by £900m, which was lower than the rise of the previous month.