First-time buyers encounter new obstacle

Some of the major high street lenders have once more revised their lending criteria, meaning that first-time buyers are missing out on the best deals and being authorised to borrow thousands less than they could previously.

Santander is one of the

firms that has made changes, and has recently reduced its lending multiple from five times a salary to four and a half. In money terms, this means a first-time buyer earning £40,000 per annum would be able to borrow £180,000 – instead of £200,000 – under the new criteria.

Barclays has already made a similar change, from five and half times salary to four and a half times, applied to first-time buyers only. As rates continue to sit at record lows, newcomers are being prevented from making the most of them and stepping onto the property ladder.

Coreco’s mortgage broker, Andrew Montlake, commented:

“It’s a tough market – buyers need a decent deposit, with help from parents where possible, and a very high income to even stand a chance of buying a home. These changes will make it that little bit harder.”

The tighter affordability rules, combined with rising house prices, have made it more difficult for first-time buyers trying to save at least 10 per cent deposit.

As a professional working in the mortgage industry, you would be the key person involved in assessing each customer’s affordability and analysing their income and expenditure. Having finished your CeMAP training and passed the end exam, you will be qualified to make recommendations on the best mortgage deal based on your customer’s individual circumstances.



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