According to the latest statistics released by the Council of Mortgage Lenders (CML), Bank of England figures show that it is refusing as many as 16,000 mortgage applications every month.

The first-of-its-kind figures disclosed by the bank – which come a day after the CML reported a 58 percent plunge in mortgage lending in the year to May 2009 – corroborate the fact that lenders are still exercising caution with regard to who the borrowers are.

Going by the CML data, gross mortgage lending in May fell 2 percent to £10.3 billion, as compared to the April figures of £10.5 billion. In addition, the figures for May show a whopping 70 percent drop from the peak of summer 2007.

The recently-released lending figure provide a complete contrast to the current run of encouraging data on the housing market, with reports from both Halifax and Nationwide about price rises in May. The CML has reasoned that an improvement in new lending has probably been eclipsed by a fall in re-mortgaging due to more stringent measures and exceedingly attractive variable rates.

However, commenting on the fact that banks are becoming increasingly ‘choosy’ about their borrowers, Richard Morea, of mortgage brokers London & Country, said: “It's much harder for homeowners to be accepted. We've seen a complete reversal in the way that mortgage lenders do business.”