Plans to loosen mortgage rules by allowing ‘responsible risk-taking’ are being considered to make it easier for first-time buyers to get on the housing ladder.
The Times this morning reports that Financial regulators are understood to be looking at allowing banks and other lenders greater flexibility to allow “responsible risk-taking” from borrowers after the Chancellor Rachel Reeves met U.K. regulators yesterday to urge them to promote growth strategies
The report says that among the proposals are plans to reform the mortgage market to make homes more affordable.
“Financial experts say the rules about lending are too restrictive and make it more difficult for first-time buyers to get on the housing ladder, even if they can afford their monthly mortgage payments.”
The report adds
“Among the areas which are expected to be examined include financial stress-testing rules that limit how much first-time buyers can borrow. At the moment mortgage lenders are only allowed to lend 15 per cent of their total mortgage “loan book” to people whose property is worth 4.5 times their annual salary.”
