Borrowers plan to ‘cheat’ the system

May 2, 2015 by Brendan O'Neill

Borrowers

New research has shown that some prospective homeowners are looking at ways to ‘cheat’ the new tougher lending criteria enforced following the Mortgage https://www.beaconfinancialtraining.co.uk/wp-content/uploads/2020/06/cemap-online-and-classroom-training-uk.jpget Review (MMR) that was carried out just over a year ago.

The MMR was implemented by the Financial Conduct Authority (FCA), which introduced additional lending regulations. This meant that lenders have to take a more detailed look at the income and expenditure of those hoping for a mortgage, to ensure they could afford to maintain the repayments both now and in the event of a future rate increase.

One in five people who said they were hoping to buy in the next three years said they were looking at withdrawing cash to spend, as opposed to using a credit or debit card – thus preventing lenders from seeing what they were spending their money on.

This could go against them though, as lenders have to use either their spending evidenced through bank statements or national averages, which even is higher. So, if an individual’s spending is lower than the national average, they may actually be preventing themselves from accessing a better deal.

Working as a mortgage professional, you will need to undertake your CeMAP training and pass the exam at the end in order to meet with and interview customers. You will have a responsibility to ensure that you fully comply with the processes and procedures of your employer, as well as the FCA regulations. You will need to undertake a full assessment of each of your customers’ income and expenditure, and obtain proofs before advising how much they may be able to borrow.