The Association of Mortgage Intermediaries has published a new report entitled The Credit Crunch – One Year On.
It predicts that there may be more bankruptcies within the industry, particularly for medium-sized firms that rely heavily on the purchase of mortgage leads.
Net lending for 2008 will be approximately £55 billion – half the level of 2007, it estimates.
Director general Chris Cummings remarks: “The impact of the credit crunch is likely to be felt much longer and deeper than was expected 12 months ago.”
UK ministers should follow the lead of their American counterparts and take action to avoid more collapse within the housing market, Mr Cummings also asserted.
The Council of Mortgage Lenders (CML) recently stated that the US government had made “difficult judgments in deciding which firms to leave to the mercy of the market”.
Freddie Mac and Fannie Mae were bailed out by US authorities while Lehman Brothers failed after being left to fend for itself, the CML noted.