Deja vu.

[Billyzin]

What could possibly go wrong?

Interest rates are rising – so why are mortgage rules being scrapped?

Analysis: Bank ruling that borrowers no longer have to show they can afford steep repayment hikes raises questions over how to curb excessive borrowing

www.theguardian.com

 

[ForssAwakens]

The important thing to this is that salary mutiples are still In. I would expect the big lenders to still stress test too as they don’t want to write off any debt

 

[Red_is_best]

I’ve seen this thread before

 

[Nano]

The stress test thing is stupid because mortgage deals are usually fixed so interest rates going up don't affect affordability. I got rejected for my last mortgage deal by one bank but was given the ok by another bank (at a higher interest rate). I am paying an extra £100+ a month for 5 years because supposedly I couldn't afford to pay £100 less. I could have had an extra £6k in my bank or paid down more capital which would've given me more buffer if rates rise.

Also, if they didn't want people to struggle after their fixed deals ended they could choose not to charge 4% above base rate as the SVR.

 

[ForssAwakens]

The stress test thing is stupid because mortgage deals are usually fixed so interest rates going up don't affect affordability.

incorrect, your mortgage can be over 30 years. Your first deal could be a 5 year fixed. The stress test is used when that 5 years up to ensure that you do not come a cropper if rates are have gone up considerably. This was particularly important when BOE base dropped to 0.5%