Rent payments may be considered as proof of mortgage affordability

A petition which calls for rent payments to be considered by lenders as proof that a borrower can afford a mortgage, has been signed by more than 100,000 people, meaning that it has to be debated in parliament.

Jamie Jack Podgson launched the petition, stating:

“Since living on my own I have paid £70,000+ in rent on time, yet still struggle to get a mortgage. Unless you’re getting handouts, wealthy or in receipt of inheritance it’s almost impossible. I want paying rent on time to be recognised as evidence that mortgage repayments can be met.”

Each region in the country has been represented with at least one signature, with the highest number signing coming from the south west. The current procedure when applying for a mortgage involves lenders checking tax returns or payslips. Although lenders need proof that a borrower will be able to repay the loan, they don’t consider rent payments for a mortgage application.

New rules were introduced after the 2008 financial crash, set by the Bank of England. Now that rules are so strict, people often find it difficult to be approved for a mortgage. According to data, it is cheaper to buy a home in the UK than rent, as research shows that home buyers are better off by £651 on average each year, than people who rent a home.

Obtaining advice from a mortgage adviser, who has taken a CeMAP course, can help borrowers to find a mortgage which is suitable for their circumstances.


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