The figures revealed an increase in the uptake of FLS funds by lenders but an overall decrease in the amount of lending during the last quarter of 2012.
John Cupis, managing director of mortgages at Sesame Bankhall Group, said: "Funding for Lending is clearly having a positive impact on UK residential mortgages and mortgage intermediaries are reporting more interest from consumers regarding taking out a mortgage to buy a new home or refinance their existing mortgage compared with the same period last year.
“This is a great start from lenders and consumers to help kick start the wider economy and we all look forward to a continuation of stronger lending figures coming through in 2013.”
Lea Karasavvas, managing director at Prolific Mortgage Finance, agreed: "From a mortgage perspective, few brokers will deny that the Funding for Lending Scheme is firing on all cylinders.
"The mortgage market's SOS has been answered by the FLS.”
However many in the industry are worried about the decrease in net lending over the quarter.
Paul Aitken, chief executive officer of borro, said: “Once again we are faced with figures showing banks are reducing lending not, in fact, boosting the loans which individuals and small businesses need.
“It’s a shame that we are yet to see any evidence the Funding for Lending initiative is working.”
Ben Thompson, managing director at Legal & General Mortgage Club, also said that he found the reduction in lending disappointing but that it is essentially ‘old news’.
“We should really be watching out for how the figures look in the first and second quarters of 2013 rather than worrying about business that was written in the late summer and autumn of 2012,” he said.
“Although still regionally quite patchy, there are very encouraging signs in terms of activity - in particular a new level of demand from first-time buyers.”
Thompson said the real frustration was the lack of property stock on the market. He attributed this lack of property on the relative lack of new homes being built and the inability or unwillingness of second time movers to move on.
Thompson added: “Much of the more recent focus has been on the FTB market however we need to start to consider how we can get the whole market moving to free up new supply at the bottom of the market.
“Whether this is through mortgage innovation, mortgage insurance or a change in Stamp Duty rules it doesn't matter. We simply need to nurture the very welcome but fragile recovery that FLS has stimulated and ensure very quickly that it does not fade away without delivering the intended results and benefits to the wider economy."
