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The credit crunch is now fully underway and analysts have warned the public after new figures showed that 50% of loans taken out in recent months went to families coming off cheap fixed and tracker  deals onto more expensive higher interest rates.

The news was broken when  information arose suggesting the credit crisis is taking its toll on UK households, pushing high street spending even lower and causing the public’s confidence to plunge to the lowest level in 15 years.

Britain’s biggest building society the Nationwide  is set to withdraw all its cheap rate mortgage deals, as it attempts to balance  and repair the mortgage book.

The credit crunch is now starting to affect households and Lenders anre finding it increasingly more difficult to borrow money  themselves and  have passed the rate hikes on to the consumer.

With London’s interbank ( The rate banks lend money to each other) Borrowing rates are rising to new highs above 6pc yesterday, analysts warned that the credit crunch would intensify.

Around three million  homeowners are due to see their present  cheap fixed rate mortgage deals expire in the coming 18 months. This will mean less houseehold income available.

Figures from the BBA showed that some 73,423 families remortgaged in February - the highest monthly total since last May - while only 38,527 took out mortgages to buy a home. Other secured lending deals (including mortgage equity withdrawal) rose to 42,320.