Plans to place loan-to-income restrictions on mortgage lenders have been announced by the Bank of England's Financial Policy Committee (FPC).
The FPC has recommended loans worth more than 4.5 times income should not make up more than 15% of a firm's new mortgage lending. Both the Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA) reccomended the move. A consultation on the new rules will close on 31 August. They are scheduled to come into effect on 1 October. The FPC said the new rules would prevent "excessive household indebtedness" and lenders should continue to apply whatever criteria they feel are appropriate to their risk appetite when taking individual lending decisions. The PRA sa...
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