Surprisingly two-thirds of potential house buyers are not aware of the new procedures brought in as part of the Mortgage Market Review (MMR) last year.
Half of those who don’t have MMR on the radar were completely unaware that one of the biggest pieces of mortgage regulation in a decade came into play in April 2014.
The other half are aware that a change has taken place but are uncertain what the changes are or what the changes mean to them.
The MMR (explained here) affects all borrowers seeking a mortgage and means that they will face greater scrutiny from lenders about their finances.
Incomes and expenditures are assessed in detail to establish how well the borrower will weather changes in interest rates or a change in circumstances. 70% of those surveyed did not realise the extent to which their expenditure would be analysed, all expenditure is examined; childcare, haircuts, holidays, takeaways, subscriptions and entertainment are all taken into consideration.
Changing your spending habits in advance of seeking a mortgage to show healthier finances with a bit more wriggle room can be helpful but a quarter of those surveyed were unaware and as such had made no changes to aid their mortgage application.
If you think you will need to apply for a mortgage in the coming months and want to make sure you are as well prepared as possible and fully understand the Mortgage Market Review then speak with Andrew Fagg from Davenport Financial Management who has been advising Mackenzie Smith clients for over 20 years.
Call 07720 355866 or email firstname.lastname@example.org to arrange a consultation with Andrew, a specialist mortgage and family protection advisor.
Statistics from: http://www.propertyreporter.co.uk/finance/mortgage-affordability-rules-leave-potential-buyers-in-the-dark.html