New Affordability Mortgage Rules Apr 14

lee111s

DebtFree14 wrote: »

This is annoying because If I apply for a mortgage and have a SKY and BT DD that doesn't necessarily mean Im going to have it when I move. I only just made the affordability on the old system thanks to a large loan payment I make. This will probably tip me over the edge now

I would assume they'll have some degree of flexibility when it comes to services you'll longer have. That said, why not cancel sky now and then it won't be a problem?

Goldiegirl

Thrugelmir wrote: »

Just back to how things used to be. In days gone by banks operated like this as a matter of course.

When banks treated loans like cans of baked beans. The writing was on the wall. Sensible lending policy is of benefit to everyone.

Good point, when Halifax got Hornby from Asda, the rot really set in.

Although, to be fair to the people who were old school bank / building society employees, we did still delve deeply into cases that caused concern.

Low LTV mortgages to low risk applicants sometimes could sail through to offer with very little underwriting.

But high LTV mortgages to high risk applicants always did receive a lot of scrutiny, at least in the office where I worked. I spent many an interesting hour going through applicants banks statements and credit card statements with a fine tooth comb. And if there were concerns that couldn't be adequately explained, the applicant would be declined.

Although the new regulations may seem revolutionary, if you've been working in the industry for a long time, it's just how things SHOULD be

Thrugelmir

Goldiegirl wrote: »

But high LTV mortgages to high risk applicants always did receive a lot of scrutiny, at least in the office where I worked. I spent many an interesting hour going through applicants banks statements and credit card statements with a fine tooth comb. And if there were concerns that couldn't be adequately explained, the applicant would be declined.

Standards vary enormously. HSBC has never substantially changed it's lending policies. Yet is accused now of cherry picking. So down to perception rather than reality.

Thrugelmir

DebtFree14 wrote: »

This is annoying because If I apply for a mortgage and have a SKY and BT DD that doesn't necessarily mean Im going to have it when I move. I only just made the affordability on the old system thanks to a large loan payment I make. This will probably tip me over the edge now

Goes far deeper than this. Lenders will be looking for borrowers that manage their money well. That don't struggle from pay cheque to pay cheque. That save regularly. That prioritise pension saving over SKY subscriptions. With all the data available lenders can build a good picture of the type of person you are when it comes to money management.

Typhoon2000

lee111s wrote: »

You don't think they'll know that you have a seperate account? You'd have to move that money from where your wage is paid into anyway so they'd query where that money went...

No, they won't know, I have several. Enough money in them not to need separate funding.

amnblog

There is very little that lenders cannot spot in the modrrn world.

BillJones

Typhoon2000 wrote: »

Maybe and idea to but your discretionary spend and non essential DDs ( Sky, magazine subscriptions etc) through another account for a few months.

Why? If you can afford the mortgage, then you've no need to hide things. If you can't, then it's stupid to gamble.

Why not just be honest and open?

Of course, the sort of person who'd hide things is not the sort of person who will end up being able to afford a mortgage anyway, as they rarely do well in life...

amnblog

It is easy to be bold about the affordability issue when it is not a problem for you.

The client with a son and a daughter who needs a 3 bedroom property and finds what was 'affordable' in April, is not in May, will not feel the same.

I can see a lot of disappointment and frustration on the horizon.