A recent report has shown that the global credit crunch has continued to take its toll on the loans market, with the number of sub-prime mortgages on the market dwindling, and the interest rates on personal loans continuing to rise.

Despite its recent nationalisation Northern Rock, which found itself at the centre of a crisis sparked by the credit crunch last year, may still struggle to find customers confident enough to deposit their money in the bank.

The Financial Services Authority has sent out a stark message to banks, warning them that the cost of selling off their loans will never be as low as it used to be, and adding that the cost of borrowing is likely to increase on a permanent basis with more lenders having to keep loans on their own books.

With interest rates having fallen twice in the last three months, and a number of further cuts expected over the course of the year, experts are stating that the financial burden on those with cheap fixed rate deals that are coming to an end has been somewhat reduced.

According to recent figures the interest rates on personal loans are significantly higher than they were one year ago, even though the base rate was the same one year ago as it is now.

Restrictions on lending have been put into place by many smaller building societies, who have found that difficulties in obtaining funds on the wholesale markets have made it impossible for them to meet the demand for loans and finance.

The Financial Services Authority has finally admitted that there were some serious failing on behalf of the regulator with regards to the way that it dealt with the recent Northern Rock crisis in the summer of last year.

Many of the consumers that are seeking loans from banks and larger lenders may have been disappointed recently, as the credit crunch as resulted in many lenders hiking up the cost of borrowing considerably, and many others tightening their lending criteria and making it far more difficult for the average person to get the finance that they need.