As the credit crunch continues to bite, getting a mortgage is suddenly becoming a whole lot more difficult.

In fact the number of home loans available has fallen by nearly 40 per cent in the past month alone. Mortgage deals are being withdrawn on an almost daily basis as lenders raise their rates, reduce their loan to value ratios and cancel any deals that are attracting too much business.

Besides the reduced number of deals, many lenders, including giants like Nationwide and Cheltenham & Gloucester, have increased their mortgage rates for new borrowers due to the high cost of funding. First Direct have said they will not be offering new mortgages to anyone who isn't already a customer.

So, if you are struggling to understand what is going on and how it will affect your mortgage, you are not alone, hundreds of ordinary UK residents (and even the experts) are in the same boat.

Today, banks and building societies are so worried that their sources of money will dry up that many have decided to close up shop until the situation becomes clearer. In reality, thus is only fueling the problem, in fact we're not so much dealing with a crisis, but with the fear of a crisis.

Banks continue to eye each other with suspicion, wondering just how much each has lent to the US housing market and how many loans on their books are going to go bad. Many lenders have estimated how much they're going to lose, but these are just guesswork and things could still get worse when the final accounts are done.

One of the biggest problems is that it takes a long time to work out exactly how much has been lost on any mortgage deal. You see when a borrower begins to get into financial difficulty, it can take months for the situation to go critical. Then the house has to be repossessed, and then sold , and it is not until that sale price is compared with the loan that any loss can be fully calculated..

This is why all our banks and building societies are so very nervous, particularly in the wake of the Northern Rock crisis. If the predicted rash of repossessions occurs in the UK, where house prices have already begun to fall, some of our lenders be left with very big losses indeed.

When will all be back to normal? Many experts are saying UBS was the last of big international horror stories, but the faltering UK property market could well still have some nasty surprises up its sleeve.

We will all have to wait and see..