SALES NEWS: Bank of England eases up on mortgage constraints
The Bank of England has responded to the cooling housing market with a relaxation of some of the mortgage constraints it discussed at the start of summer. In June, the Bank had recommended that lenders should approve no more than 15% of mortgages at, or above, 4.5 times a borrower’s income. However, to the delight of the Council of Mortgage Lenders, final regulations issued in October stated that the Bank’s Prudential Regulation Authority had proposed that firms which report less than £100m of new mortgage lending a year would escape the net.
CML’s director general said, “while it is not yet entirely clear how this approach will affect individual lenders, it’s a clear improvement on the original implementation proposal.”