Mortgage Affordability
Mortgage Affordability

Mortgage Affordability Checks

Mortgage application approvals have fallen since this time last year. This may be proof that new Mortgage affordability checks are coming in to play.

According to the bank of England Mortgage Approvals have fallen to the lowest level since last June. In may the bank of England state that their were 61,707 mortgages approved which was down from 62806 the previous month with a spike in approvals at 75,901 in January.

According to the BBC and HRMC house sales have been rising and reached there highest levels in May.

This reduction in mortgage approvals may be due to the increased focus that the banks and mortgage lenders have put on affordability of mortgages.

From October proposed caps are that banks and building societies will only be able to lend 15% of their mortgages to riskier applicants with higher income multiples of 4.5 .

The situation has not changed when you try and source a mortgage, each lender will have different criteria with some lenders being more generous in Mortgage affordability than others. If you were declined with one lender this does not mean that you cannot get a mortgage with another.

It is important to get an idea  of  how each lender assesses affordability before applying or obtaining an agreement in principal. Most lenders will have a Mortgage affordability calculator that will assess your ability to afford the mortgage to give you an indication before you proceed to do do a credit check. It isn’t advisable to perform multiple credit checks just to assess affordability. Ask an advisor to assess your Mortgage Affordability and check your credit report yourself using a site such as credit expert.  This way you will have an idea of your credit rating and it will not leave a footprint on your file. This will give you an indication of how much you can borrow.









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