August 2008 wasn’t a good month for the UK mortgage industry as the industry slumped to all time low. However, this did not happen overnight, this tendency has been gradually building up since April 2008 and it hit the rock bottom in August. It is noted that the mortgage industry slumped by 36% in the past one year. There was a drastic change within one month from July to August 2008 whereby the gross lending was reduced by 12%. Global credit crunch is having its impact on the UK mortgage industry. There is a heavy shortage of mortgage finances and as a result the mortgage lending industry started demanding larger deposits. This made the buyers to think twice before they ventured into acquiring any new properties. Without any eager buyers, the house prices are continuing to fall and the downward pressure is increasing day by day.