Optimism has returned to the UK mortgage market following the Bank of England''s announcement on liquidity this week.

The Bank revealed on April 21st that £50 billion will be made available to banks as part of its Special Liquidity Scheme.

It means that banks can swap mortgage assets for UK Treasury Bills in a bid to encourage them to begin lending to each other again.

The scheme has received much support and one expert has revealed that he is now confident about the future prospects of the mortgage market.

Sir Peter Burt, former deputy chairman of HBOS, said that he feels he has many reasons to be optimistic about the future prospects.

"I am very optimistic because the Bank of England has said that if £50 billion is not enough, they will put more in," he told BBC Radio Four''s ''The World at One''.

"I think from that point of view there will be an increasing volume of money and the liquidity should start to cease to be a problem," he added.