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UK mortgage market to become more flexible

Date: Mon, 17 Oct 2005

The UK mortgage market could become more flexible and less reliant on income, according to a new report.

A study from Alliance and Leicester suggests that using salary multiplies to determine how much a homebuyer may borrow is set to change as more lenders move towards affordability calculations.

Affordability uses an individual’s level of disposable income and personal circumstances to determine mortgage repayments rather than just their set monthly wage.

It is hoped that the changes will mean households without children and single buyers will be able to qualify for higher mortgage loans.

"Affordability provides a more responsible approach to lending as it considers an applicant’s individual circumstances – those who are debt free will benefit the most," said Stephen Leonard, director of mortgages at Alliance & Leicester.

He added: "The move towards affordability based lending means that more people will get a helping hand onto the property ladder – and homeowners will continue to be able to ‘move up’ as their incomes rise."


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