Proposals from the Financial Services Authority (FSA) to limit the amount people can borrow for their mortgage are "trying to destroy the housing market", says one expert.

Catherine Hearnden, director at MyMortgageDirect, says the measures are "totally prescriptive" and may restrict people from being able to change their mortgage.

"In theory, they won’t be able to afford the mortgage they have got, which is absolutely ridiculous because that is not the problem that we are having with the housing market," she continues.

People who cannot afford a mortgage are likely to experience problems, Ms Hearnden claims, which may encourage people to seek advice from a debt management company to help them with their money issues.

She adds that the FSA is attempting to show it has some authority after the bad press it has received recently.

The Council of Mortgage Lenders reported in February 2009 that 40,000 houses were repossessed in 2008 (one in 290 mortgages).

It also found that 8,900 mortgages were approved for first-time buyers in January 2009, down by 27 per cent compared to December 2008 and down by 51 per cent compared to January 2008.