Mortgage income cap thoughts

February 24, 2015 by in category Mortgage News with 0 and 1

In a poll organised by Mortgage Solution 55% of those who replied did not think that lenders would place a blanket cap on loan to income
Over the last few months Barclays and Santander have introduced or extended LTI caps on some or all of their mortgage products.
It was last year when the Bank of England’s Financial Policy Committee issued proposals recommending that loans which needed more than 4.5 times income should occupy less than 15% of a firm’s new mortgage lending.
Unfortunately the timing of this coincided with a down turn in demand following fears of a housing bubble
Lenders such as Lloyds Banking Group and RBS already have caps of four times income for loans above £500k and both have stated they have no plans to introduce a blanket cap.

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