Friday, November 26, 2010

Borrowers offered a mortgage lifeline

Borrowers offered a mortgage lifeline

Interest-only borrowers, the self employed and first-time buyers without a chunky deposit or wealthy parents all stand to benefit after the Financial Services Authority climbed down over its plans to push through its controversial Mortgage Market Review reforms.

Posted by hpsvinod @ 02:08 PM (920 views)
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One thought on “Borrowers offered a mortgage lifeline

  • Over 2 years on from the start of the housing crash and the FSA has announced that they won’t bring in new regulations for the mortgage market until next Summer – that’ll make it 3 years. I think this says a lot about the FSA.
    The tone of the article is amazing. For instance:
    The postponement of the reforms “could provide a window of opportunity to struggling first-time buyers and those ….who are concerned that they will not meet stricter affordability criteria”.
    Surely this is a good reason not to delay the introduction of the reforms!
    “And the test disregards the possibility that borrowers are able to cut down on discretionary spending, after they purchase a home or move up the housing ladder”
    In which case, they would presumably have a larger mortgage and even less disposable income. And if first time buyers have been saving hard for years to have the deposit required, where will these reductions in their dicretionary spending come from?
    Not the best logic I’ve come across, but then maybe this is no surprise coming from the same paper that brought us the MMR scare.

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