How mortgage market changes could help first-time buyers onto the property ladder
The changes to lending that could be a leg-up for home buyers
- The Financial Conduct Authority (FCA) is proposing and implementing changes to mortgage regulations to make it easier for first-time buyers to get onto the property ladder and stimulate economic growth.
- These changes include greater flexibility on interest rate stress tests, considering past rent payments as proof of affordability, and altering loan-to-income ratio rules for lenders.
- The move comes as high house prices, tough existing mortgage rules, and recent stamp duty changes have made home ownership increasingly difficult for many.
- While some lenders, such as Santander and Nationwide, are already relaxing their lending criteria, mortgage brokers caution that responsible lending and borrowing are crucial to prevent future financial hardship.
- The FCA aims to balance increased accessibility with market stability, ensuring sustainable home ownership without repeating past financial crises.