The results show a reaction to the inflated December market and the adverse weather conditions, according to the BBA.
BBA statistics director, David Dooks, said of the latest data: "It was no surprise to see the January mortgage figures falling back from December, when transactions were being pushed through to beat the end of stamp duty relief. There was a natural reaction in the January figures and the bad weather further suppressed market activity.
"After the Christmas period, demand for consumer credit was weaker in January, as people shied away, or were discouraged by the weather, from retail spending and held on to their deposits.
"The total amount lent to non-financial companies of £340bn continues to contract, as demand for finance remains subdued and trading conditions are still adversely impacting on business sentiment."
