Some 27,100 loans worth £3.8 billion were handed out to first time buyers in August, marking a 7% increase on the month of July, when the number of first-time buyers was already running at its highest levels since 2007, according to Council of Mortgage Lenders' figures.
Lending to first-time buyers in August was one third higher than in the same month a year ago.
The findings were released on the same day that Halifax started taking mortgage applications from people with 5% deposits under the new phase of the Government's controversial Help to Buy scheme, which has fuelled fears of a house price bubble.
The CML figures showed that first-time buyers stretched their borrowing in relation to their income in August, borrowing 3.36 times their salary typically, which was a jump from 3.31 in July. The latest figure marks the highest borrowing ratio seen for first-time buyers since 2007.
Despite these borrowers stretching themselves more, current low interest rates on mortgages are helping to keep their monthly mortgage payments relatively affordable. The typical first-time buyer monthly mortgage repayment now represents 19% of their income, edging down from 20% a year ago.
A record 86% of mortgage borrowers took advantage of the cheap deals currently on offer by taking out fixed-rate mortgages in August, the CML said, with 94% of first-time buyers opting for a fixed-rate deal.
The latest figures come in the same week that the second phase of Help to Buy was fired into action to give credit-worthy borrowers with low deposits a helping hand to buy a mortgage, with lenders offering state-backed products.
Royal Bank of Scotland and NatWest started offering mortgages under the scheme on Tuesday and have previously reported appointments being booked out for this week amid strong levels of interest.
RBS/NatWest is offering a fee-free two-year fixed rate deal at 4.99% for buyers with 5% deposits under the new phase of Help to Buy.
A similar two-year deal with a fixed rate at 5.19% and a £995 product fee is available through Halifax and Bank of Scotland.
Santander, HSBC, Lloyds Bank, Virgin Money and Aldermore have all confirmed they plan to join up and have not yet given details of their products.
Lenders which are not part of the second phase of Help to Buy are also stepping up competition to better these deals.
According to financial information website Moneyfacts, Yorkshire and Clydesdale Banks have lowered a three-year fixed rate deal for people with a 5% deposit by 0.5 percentage points to 4.99%, matching the rate offered by NatWest under Help to Buy but with the deal lasting for a year longer. The Yorkshire/Clydesdale deal also comes with a £250 cashback incentive.
Mark Harris, chief executive of mortgage broker SPF Private Clients, said: " The mortgage guarantee phase of Help to Buy will boost the numbers of first-time buyers although the rates announced so far are disappointing.
"With a Government guarantee behind them, you would expect lenders to be able to offer cheaper products. However, as more lenders join the scheme rates should fall further."
Housing Minister Kris Hopkins said: "Today's figures from the Council of Mortgage Lenders clearly show how the housing market has turned a corner and people are getting the confidence to take that important first step on the property ladder, leading the numbers of first-time buyers to reach their highest level for six years.
"But we remain determined to ensure anyone who works hard and wants to become a homeowner has help to do so, and that's why we've introduced schemes like NewBuy and Help to Buy, which offer a valuable alternative to the bank of mum and dad and enable people to buy with a fraction of the deposit they would normally require."
© 2013 Press Association