FSA propose new mortgage lending rules

FSA propose new mortgage lending rulesThe FSA (Financial Services Authority) have proposed tighter lending guidelines in an effort to avoid borrowers taking on mortgages which they cannot afford. The FSA set out the new proposals in their ‘Mortgage Market Review’ saying they were “common sense”. The proposals are mainly aimed at stopping ‘self cert’ mortgages, where applicants do not need to prove their income, and a move away from interest only mortgages where no specific repayment vehicle in place. The FSA has told lenders that they must ...

Mortgages at their most affordable for over 10 years

The proportion of household income being used to meet mortgage repayments has fallen to the lowest level since 1999. Research done by the Halifax shows that for both first time buyers and existing homeowners the average mortgage now takes up 28% of disposable income, the peak was at the height of the housing boom in 2007 when the figure stood at 48%. All 12 regions of the UK have seen an increase in mortgage affordability since mid 2007, with the largest improvement taking place in Wales and Northern Ireland. The most expensive part of the UK would seem to be Kensington & ...

New mortgage uses rental payments to prove affordability

First time buyers in rented accommodation who want to get on the housing ladder have a potential new option thanks to an innovative new mortgage launched this week. The “Rent to Buy”  mortgage from the Saffron Building Society is available to first time buyers who can prove a 12 month rental history through a recognised letting agency and have a 5% deposit. The rental history is used as proof that the borrower can afford a mortgage with monthly payments of the same level. The Saffron’s sales and marketing director, John Eastgate, said: "There are many potential first-time borrowers who are capable of ...