Robert Sinclair, director of AMI, said: "The Government must now encourage an increase in funding levels before it introduces any interest rate rise. If it fails to do so we will see significant issues for consumers looking for available mortgage finance. Lenders remain capital and liquidity constrained and this needs action.
"Encouraging wider securitisation will be an important aspect in opening up lending. The Financial Reporting Council's review on securitisation could provide some of the answers for the restoration of a normal mortgage market. This has to be completed before the inevitable interest rate rises commence."
