Loan lenders are carrying out evermore stringent checks when it comes to looking at prospective borrowers' ability to pay back money, it has been revealed.
In an article in the Financial Times, lenders are reported to be delving further into the credit histories of those applying for a loan to make a more accurate assessment about if they will be able to successfully pay back money lent to them.
The news comes as credit providers are said to be attempting to minimise the risk of borrowers defaulting on payments following the "market turmoil" witnessed over the course of last month.
Meanwhile, sub-prime mortgage lenders have been "quick" to increase interest rates during the past few weeks and although mainstream borrowers are currently leaving the majority of their rates "largely unchanged", a tightening in lending criteria by such consumers has been noted.
As a result, providers are now giving a closer look at applicants' borrowing history, any outstanding debts they may have and what the level of their disposable income is.
In addition, it has been suggested that blemishes on a borrower's credit rating which may have been previously considered "minor", for example such as a missed payment on a mobile phone account, are now being taken more seriously.
Consequently, it was purported that access to credit is to now be limited for a variety of Britons including first-time buyers, those homeowners looking to remortgage and people wanting to take out credit cards and secured loans.
Neil Munroe, director of external affairs at Equifax, told the publication: "Lenders are looking deeper into people's credit histories.
They will be looking in more detail for early warning signs of how borrowers deal with credit.
" Meanwhile, Jill Stevens, director of consumer affairs at credit ratings agency Experian, said: "We are seeing a tightening up across the board on lending.
Lenders realise there are lessons to be learnt from the US sub-prime mortgage market.
" She added that loan lenders are increasingly looking at whether borrowers consistently make the minimum monthly repayments or look to clear the full balance owed on their existing credit accounts.
However, it is thought that those applying for a mortgage could find themselves subject to the toughest checks.
Due to the large proportion of money they wish to take out, prospective applicants, in particular those seeking higher loan-to-value mortgages, may be set to find they have greater difficulty in passing borrowing criteria.
However, it was indicated that loan companies are unlikely to impose formal restrictions on how much applicants are allowed to borrow as Simon Tyler, from broker Chase De Vere Mortgage Management, reported companies could begin to ask "more probing questions about income levels".
Last month, a report by Reuters revealed that those consumers who currently have money in a sub-prime mortgage or are considering taking out bad credit loans as a way of supplementing their finances after being turned down for 'traditional' borrowing should re-evaluate their finances.
According to the news agency, a number of lenders have increased their rates due to recent instability in the financial markets, which in turn may push up the amount of monthly repayments required for bad credit loan consumers and affect other areas of their finances.