Agreement calls for more policy reforms, regulatory scrutiny and support for lender innovation – Mortgage Strategy
Accord Mortgages has called for more policy reform, regulatory scrutiny and support for lender innovation after new research revealed rising broker concerns about borrowers’ mortgage affordability.
New research has found that 73% of mortgage advisers surveyed believe that despite recent regulatory improvements, borrowers will face greater challenges over the next decade due to high living costs and rising house prices.
Jeremy Duncombe, managing director at Accord Mortgages, said: “While recent developments around affordability rules and loan income limits are encouraging, more needs to be done, and faster.”
“As an industry we must think creatively, particularly to support first-home buyers and ease pressures on savings, the gap between house prices and income growth and affordability.”
“This means maintaining positive momentum by continuing to review regulation, giving lenders more freedom to innovate, allowing them to create new types of products – an example of this is our recently launched £5,000 deposit mortgage, which allows people to borrow up to £500,000 with a £5,000 deposit.”
“And we need the government to provide incentives for downsizers, amend the Help to Buy scheme and reintroduce stamp duty relief for first-time buyers to ensure the housing market thrives and provides more opportunities for all types of borrowers.”
Earlier this year, the regulator clarified affordability rules and began a review of loan-to-income (LTI) limits, allowing lenders to responsibly increase the flexibility they offer borrowers, providing them with a significant boost.
Accord was one of the companies to act in response to these changes, updating its affordability model and increasing LTI limits to be able to offer more loans.
“Progress is happening, but these findings confirm what we already knew – there is still more to do. Borrowers, especially first-time homebuyers, face significant obstacles such as inflation, stagnant wages and rising property values,” Duncombe explained.
“At Accord, as one of the largest intermediary lenders in the country, we understand the important role brokers play in helping borrowers navigate these challenges, and their importance is only growing.”
“Brokers will also need to help address the market’s lack of understanding of the positive changes that have occurred to date and what these may mean for individual clients.”
