Recent reports suggest that a number of lenders have dominated the home loans market leaving many out in the cold.

With trust in a number of banks at an all time low, many are sticking to the banks which have avoided trouble during the start of the recession.

The new figures released by the Council of Mortgage Lenders suggest that six lenders have managed to increase their hold over the mortgage market in 2008.

According to the figures Lloyds banking group topped the chart accounting for 78 per cent of all new loans in 2008, up from 72 per cent the year before.

The Council said that the credit crunch which started back in 2007 had dried up the supply of mortgage finance, meaning that lending in fact dropped by 28 per cent last year with some specialist lenders being driven out all together.

Dramatic changes in lending community

Summing up the figures the Council of Mortgage Lenders said: "The lending community itself has undergone dramatic changes. With so many lenders either merging or ceasing lending, this year's largest lenders' table has changed more than in other years."

One big event which affected the list was Northern Rock dropping out of the top 10 after it went into insolvency, the company which has only just started providing home loans again accounted for eight per cent of all new lending.

This figure dropped to just 1.1 per cent in 2008, the other major factor which effected the list was the large amount of specialist lenders who have stopped lending over the last year. Companies which did not rely on savers money to finance their lending fell from seven per cent to just two per cent in 2008.

"In effect, many specialist lenders ceased new lending in 2008," the CML said.

Ray Boulger of mortgage brokers John Charcol, said borrowers were now receiving the worst of all possible worlds.

Fewer lenders leads to less competing

He said: "If you have fewer lenders you have less competition. Those lenders still in the market have only limited amounts to lend, so they aren't competing hard with each other if borrowers have less than a 25 per cent deposit," he added.

After Lloyds, the biggest lenders in 2008 were Santander, the Nationwide, Barclays, RBS and HSBC.

Mergers have also been another major factor in the small number of lenders dominating the list, with some banks taking over some of the struggling completion it meant that some lenders where being accused of unfair practice.

The most notable was Lloyds takeover of HBOS combing the first and third biggest lenders, other mergers included Spanish banks Santander's takeover of Abby and Alliance and Leicester. Building societies also got in on the action with Nationwide taking over Cheshire and Derbyshire.

The Council of Mortgage Lenders warned that we may have not seen the last of the mergers with saying that "next year's table is likely to look different again, with more new names and an even larger market share in the hands of the largest firms", it added."

Many will be interested to see if Lloyds can continue their domination in the mortgage market but any future mergers could see some crying foul claiming some companies dominating the market are not giving anyone else a chance.