New rules aimed at limiting risky mortgages have come in for criticism from property experts.
A plan by the Financial Services Authority (FSA) to limit so-called "risky" mortgages has been attacked by industry commentators.
Lord Turner, chairman of the FSA, is widely expected to announce new legislation this week which will see mortgages limited to three times the buyer's annual salary. Additionally, a ban on 100 percent mortgages is predicted.
Reckless lending by banks to people who are unable to afford the mortgages they have received has been seen by many experts as one of the reasons for the UK's high debt levels. This has also led to a sharp increase in repossessions over the past few months as the recession has taken hold.
However, John Charcol, an independent mortgage advisor, warned that the measures will hurt first-time buyers.
"Why should someone who chooses to allocate a higher proportion of their income to their home than someone else for whom a maximum of three times income may be appropriate because they choose to spend more on, [for example] cigarettes, alcohol, eating out, clubbing and holidays, be penalised?" the company said in a statement.
"Furthermore, if mortgages are limited to three times income many borrowers who have borrowed more than that, but have a perfect credit rating, would be denied the opportunity to remortgage or move house, and would therefore be at the mercy of whatever uncompetitive rate their current lender chose to offer them."
