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MMR affordability checks could strangle mortgage approvals

Samantha Cordon
Written By:
Samantha Cordon
Posted:
Updated:
26/02/2014

Intermediary mortgage lenders and brokers have continued to express concerns about the immediate impact of stricter Mortgage Market Review affordability checks.

An IMLA survey revealed that half of brokers anticipated more mortgage applications will be rejected due to more stringent affordability checks against interest rate rises.

This compares to 44% who thought the same in July 2013, according to the Intermediary Mortgage Lenders Association.

The growing fear is shared by lenders; those which think stress testing will not affect approval rates has fallen from 73% in January 2013 compared to 43% in January this year.

Peter Williams, executive director of IMLA, said industry jitters were understandable as the MMR implementation grew closer.

He said: “The market is still in its early stages of recovery and there now seems to be a growing consensus that the new regulations will have at least an initial dampening effect.”


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