It seems that MMR cannot stay out of the news. This time it is not a controversial vaccination for small children but the 'Mortgage Market Review'. Following the financial crisis of 2008, a review of the residential lending market was undertaken and the successor to the Financial Services Authority, the Financial Conduct Authority (FCA) introduced its new rules for mortgage lending on 26 April 2014. The aim is to ensure that most borrowers get help from an adviser before taking out a mortgage and have a good idea as to the affordability of their mortgage both at the time of the application and if interest rates increase.
Some of the headline changes are that borrowers will be required to provide much more information about their monthly outgoings and lenders will want to see repayment proposals for when an interest only mortgage ends.
To see the FCA guide for consumers go to: http://www.fca.org.uk/consumers/financial-services-products/mortgages/mortgage-market-review
Whilst the new changes affect you at the beginning of the house buying process, it is important for you to ensure that you obtain clear legal advice as to the nature of the responsibilities that you will be taking on in relation to your loan. Your solicitor will be able to help you with these aspects and will be able to provide an explanation of the new lending requirements.
If you would like to discuss any aspect of the house buying process, contact us.