We are now well and truly into the Financial Conduct Authority’s new set of mortgage rules (Mortgage Market Review or MMR)– the last few weeks have been interesting but also somewhat frustrating.
At the heart of MMR is a new affordability check, that will see applicants asked about their income and outgoings including for example childcare costs, gym membership and how often the eat out.
Now my first point is that prior to owning a property, I had no childcare costs, I did belong to a gym which I never attended and ate out about 4 times a week. I have never had so much disposable income since that time, yet I lived permanently in my overdraft.
As soon as I got my first mortgage I cancelled my gym membership and didn’t eat out again for about 2 years. Having finally made the adjustment to homeowner, and once again got some money in the bank I fell pregnant, so basically my “going out” money was transferred to my “childcare” costs.
The FCA said that the changes were designed to "hardwire common sense" into the mortgage application process, which on the surface makes sense. The only problems seem to have come when lenders start interpreting these guidelines for themselves.
Nearly all the lenders we deal with have brought in new systems and tweaked their affordability calculators to take account of the new rules, some of them did this way back last year so the transition has been fairly seamless. Others are taking things to the extreme. Naming no names, but one particular lender seems to want to know how much male clients are spending on male grooming products. I am not sure how to answer this – what happens when Boots are doing a 2 for 1?
For more information about MMR or mortgages in general contact us or call our team on 01628 507477.
Recent posts
The top 10 most beautiful villages in the world
12 days ago
Forbes has published a global ranking of stunning locations and one popular picturesque corner of the UK has nabbed top spot.
Over three years after the Mini-Budget took place, we look at what the mortgage market looks like now, showing the difference in mortgage repayments.
The government has announced plans to make buying or selling a home cheaper and quicker with what is being called the “biggest shake-up to the homebuying system in this country’s history.”
More borrowers using equity release
1 Oct 2025
Almost one in five equity release mortgages are now taken out to provide financial support to family.
Buyers purchasing properties sooner
29 Sep 2025
According to industry data, the expected wait for those looking to buy a property has dropped from just over 11 months to less than six months.
It is common for your first mortgage payment to be higher than your subsequent monthly payments for two reasons.
What to do just before you get your keys
24 Sep 2025
Firstly, a big congratulations, you’ve now exchanged contracts! After weeks and months of waiting, you are about to move in. What should you do first?
The chancellor will deliver her second budget this autumn. Due to slow economic growth and high inflation, the government need to manage a £40 billion shortfall in public finances. There have already been reports about changes to taxes including income tax and capital gains tax.
More information
Trusted by
