The Financial Policy Committee will “consider whether there are any barriers” to increase the “hopeful” companies’ loans to 4.5 times the revenue limit.
The main banks of the English institutions – the Central Bank, PRA and the Financial Conduct Authority sat on the institution and published the work in the minutes of the April meeting.
New residential mortgages are capped, or more than 4.5 times the salary to 15% of the total annual loan amount, under the current LTI rules set by the FPC in 2014.
But various industry bodies such as the UK Finance Association, the Building Society and the Association of Intermediary Mortgage Lenders have also called for the relaxation of this rule to increase loans, especially among first-time home buyers.
FPC said, “Support lenders to leverage their separate LTI traffic restrictions in line with their own risk limits and business models.
“To support this, the FPC will consider whether there are any barriers to using these restrictions to those lenders who wish to.”
But it added: “Most large lenders are currently well below the 15% threshold, but if they change the way they test individual borrowers affordability, their LTI stocks are likely to increase.”
FPC Minutes did not list a schedule for this comment.
Last week, the Prudential Regulatory Authority and the Financial Conduct Authority Open discussion About LTI rules.
Currently, institutions that borrow less than £100 million a year are exempted, and regulators recommend expanding it to companies that borrow less than £150 million a year.
But the change doesn’t help major lenders like the nation, and they are also calling for the relaxation of the rule.
However, the FPC noted that last month, the FCA reminded lenders of “flexibility in the rate “stress test” rules”, adding that “some lenders have adjusted their approach as a result.”
Regulators are concerned that making it easier to get a home loan to push up home prices, property and debts.
Last month, Financial Conduct Authority CEO Nikhil Rathi said the property was about 1,000 per quarter, a historic figure, but “as lenders show greater tolerance, we have the most accounts ever with debts that are more than 10% of the balance.”
“So there are trade-offs here, people are being kept at home, but the balance is accumulating,” Rathi added.
