Ex-Financial Conduct Authority (FCA) mortgage sector manager Lynda Blackwell has criticised lenders happy to lend to a raft of borrowers before the credit crisis, but unwilling to lend now, even when those same borrowers continue to keep up mortgage repayments.
You and Yours BBC presenter Winnifred Robinson today quizzed Blackwell, after she exclusively revealed she was refused a mortgage to Mortgage Solutions by her current lender due to lack of income evidence.
Blackwell said: “I left the FCA last October and I was a self-employed consultant applying for a mortgage.”
Robinson asked her why it hadn’t occurred to her that this might happen.
Blackwell said: “The rules don’t specify how lenders get the evidence. It just takes a little more effort on the part of the lender,” she added after explaining she ended up with an unnamed specialist provider.
“The rules don’t stop you getting a mortgage, it’s the way those rules have been interpreted by the lenders.
“I think what needs to happen is that lenders should entertain people who don’t fit their sausage factory. It takes a lot more effort, and although it is more cost effective to run highly automated processes, there are underwriters who are perfectly able to underwrite these deals,” she added.
Blackwell added that plenty of lending was done to adverse credit, high loan to value or interest-only borrowers with no repayment vehicle pre-credit crunch, so lenders “should be able to help them out when they want to move to a cheaper deal now”.
Article originally posted on Mortgage Solutions