The computer says “No”

The computer says “No”

With lenders all rushing to out do themselves on the sophistication of their affordability models and the lack of underwriters with any authority to take a common sense approach, we find ourselves in the bizarre situation of a £50,000 remortgage on a £300,000 value property more difficult to place than the first time buyer on 85% loan to value.

The focus seems to have swung totally towards earned income, which means that the retired 63  year old with a £50,000 mortgage who has been paying a repayment mortgage down for the last 10 years suddenly finds no one wants to lend to him because he only has a private pension of £10,000, plus a self employed hobby business earning him £3,000 per annum.

So, he has lots of equity in his property, has an excellent repayment record and can easily afford his £50,000 repayment mortgage.  Yet he finds that he does fit the affordability criteria, so is left on a high standard variable rate.  This cannot be right especially in a climate where we are supposed to be looking at risk averse lending, can it?

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