The Deputy Governor of the Bank of England Sir Jon Cunliffe has warned that the household debt levels in the UK could pose a ‘risk’ to our financial stability.

He said that, with a faster increase in house prices than in people’s incomes, borrowers are having to take larger mortgage debts in order to facilitate their house purchase.

The Bank of England has already taken some preventative steps in an attempt to slow the rise of house prices. During the course of 2014, the Bank of England enforced a cap on mortgage lending, by imposing a set number of loans issued at more than 4.5 times the applicant’s income.

Following the Mortgage https://www.beaconfinancialtraining.co.uk/wp-content/uploads/2020/06/cemap-online-and-classroom-training-uk.jpget Review, the Financial Conduct Authority also enforced increased affordability regulation on lenders to make sure that borrowers would be able to afford to maintain their repayments even with rate increases.

The recently published bi-annual Financial Stability Report by the Bank of England issued a warning to borrowers who are turning to credit too eagerly. The report suggested that borrowers are not just putting themselves, but also the economy at risk.

Sir Jon said:

“We are not seeing the sort of growth in momentum we saw this time last year, but given the high level of debt to income we have in the UK anyway, and the ability of this market to move very fast, this is something we need to watch.”

Having passed your CeMAP training and associated exam you will be qualified to assess your customers’ ability to maintain their mortgage payments and advise the best mortgage package for them.

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