A recent report has suggested that the stringency in the mortgage lending industry, which has been seen over the past two year since the onset of the global credit crunch, is now being relaxed slightly, as many are concerned that if it continues it could hamper the possibility of recovery within the property market.

Since the global credit crunch stricter regulations over lending have meant that many people have been unable to get a mortgage loan, which has had a serious negative impact on the property market and property sales levels.

The Prime Minister discussed 100 percent mortgages with the Financial Services Authority earlier this year. These mortgages were once popular with first time buyers who had little or no cash to put down as a deposit on their mortgage, but Gordon Brown wanted the FSA to consider banning mortgages with such high loan to value rates.

He said that there were higher risks with any mortgages that required a deposit of less than 10 percent from the borrower.

However, executives from the FSA have recently told a parliamentary committee that if this action is taken it could seriously affect the chances of the recovery of the property market.

The FSA said that these measures would mean that first time buyers were still frozen out of the property market, and that this would result in confidence levels dropping again just as they had started to increase.

Before the global credit crunch 100 percent and even 125 percent mortgages were widely available to first time buyers, who were able to get onto the property ladder without any deposit with these mortgages. However, since the financial crisis these deals have disappeared from the shelves, with lenders not demanding sizeable deposits from all borrowers.

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