Some lenders still offering 5x income multiples

penguine

But only to those who meet strict criteria, apparently.

(Northern Rock, Abbey, and Alliance & Leicester if anyone wants to dash out and apply.)

http://www.guardian.co.uk/money/2009/mar/20/mortgages-income-multiples

chucky

penguine wrote: »

But only to those who meet strict criteria, apparently.

(Northern Rock, Abbey, and Alliance & Leicester if anyone wants to dash out and apply.)

http://www.guardian.co.uk/money/2009/mar/20/mortgages-income-multiples

they never stopped

that I know C&G and Halifax are doing it

mitchaa

C&G, currently 5x joint if i remember correctly.

ad44downey

penguine wrote: »

But only to those who meet strict criteria, apparently.

(Northern Rock, Abbey, and Alliance & Leicester if anyone wants to dash out and apply.)

http://www.guardian.co.uk/money/2009/mar/20/mortgages-income-multiples

Madness. They'll be looking for another government handout soon enough.

steadysaver

Its crazy.

I was in Halifax in January, moving some savings around and was interested what mortgage deals they had. We could provide a joint income of around 50K and Halifax would have been prepared to lend us 321K. I looked at the adviser in shock and told him, "no wonder your in the s£$t".

Conrad

3 x income limit is a bar room expert notion.

Plenty of people borrowing 5x income are perfectly capable of meeting thier outgoings, particularly high earners as they may spend proportionally less on food and travel for example than a low earner.

Time2Go_25

It should be down to affordability not arbitrary multipliers. If multipliers are used then surely it must change with interest rates. So say I earned 30000 and all I could borrow is 90000 with say a SVR of 3.5% I'd be paying back £455 a month.

Therefore if the SVR goes up to 6% I can obviously only still pay back £455 a month and therefore the multiplier would need to go down to 2.3x.

You can't just have a single multiplier for all situations and people, affordability is the only way it can be judged.

lostinrates

Northern Rock calculator this afternoon:
salary £25k, no loans, borrow upto £85k -3.4 x
salary £45k, no loans, borrow up to £162 k - 3.6 x
salary £95k,no loans, borrow up to £342k -3.6x

Interesting to see at least on a first glance they seem to be looking at mulitple as a starting point, then possibly looking at affordability on actual application?

Graham_Devon

I reckon NR may be the leader in high multiple loans from now on.

chucky

it's also a coincidence or not that the 5x lenders are Government owned in some way

ad9898_3

mitchaa wrote: »

C&G, currently 5x joint if i remember correctly.

If that's right mitchaa, it's completely insane. It's a bad enough debt burden for 2 people, but over the course of a typical 25 year mortgage, the chances of both applicants avoiding, illness, accident, pregnancy, unemployment, death, divorce/separation is virtually nil, leaving a sole applicant with a 10x salary mortgage to service.

And we wonder why we are where we are:rolleyes:. For some lenders, nothing has been learned.