Blog Post

Bank of England considers removing Affordability Test

TomS - Head Tom Simper Mar 10, 2022, 10:30 AM
249_Dataloft_inform_Insight2

Mortgage approvals, which surged in 2021 on the back of demand from home-movers, have sustained a high level into 2022, continuing to outpace any period since 2008.

Meanwhile, the Bank of England is considering removing the ‘affordability test’ which tests a borrower’s ability to service their mortgage as interest rates rise.

However the Loan to Income (LTI) multiple of 4.5 times income will remain and this is proved to be more effective at curbing risk during a housing 'boom'.

The removal of the affordability test would make it easier for some first-time buyers to get a mortgage although, for an estimated 83% of renters finding a 5% deposit remains a barrier. Source: Dataloft, Bank of England

Leave a comment
Newest on top Oldest on top
Load more comments
Thank you for the comment! Your comment must be approved first
comment-avatar

"Yaseen has been fantastic very helpful and good communication all the way through"

- Kate Dawson

"We would like to give a special thanks to the newest member of staff Aleaya"

- Daniel

"I would highly recommend Gill and the team"

- Isabelle

"I will greatly recommend. Keep up the great work"

- Josiane

"Sean C. - he is a very helpful person! Cheers!"

- Tomasz

"Letting through Peter Anthony has been a great experience"

- Gus Beech

"Helpful, cheerful and thorough throughout the whole process"

- Jay

"Very polite and helpful"

- Daniel