Mortgage lending in the UK remained slow last month, according to the latest figures from the Council of Mortgage Lenders (CML).

Total lending for home loans stood at £12bn in September, the lowest September total since the year 2000.

The CML's figures, which cover borrowing for house purchases as well as remortgaging, were down 1% from August and 7% lower than in September last year, figures that indicate that lending is stagnating after picking up earlier in the spring.

"Gross lending in the third quarter of 2010 was an estimated £37.4bn, a 9% increase from the second quarter and down 4% from the third quarter of last year," said the CML's director general Michael Coogan.

"Lending volumes do not seem likely to increase substantially towards the end of the year.

"Funding pressures on lenders remain, and the practical implications of government and public spending cuts are beginning to emerge, with a resulting impact on consumer confidence," he added.

The official Bank of England figures show that approvals fell from 60,000 in June to 55,000 in July and then 48,000 in August.

Analysts have suggested that uncertainty over the economic effects of the government’s spending review, public sector cutbacks and demands by lenders for increasingly higher deposits from first time buyers are behind the decrease.