New lending rules 2014
Advice

New Mortgage Rules - what does this mean for you?

Samantha Robertson-Strong Samantha Robertson-Strong
2 min read

So what’s changed?

On 26 April 2014 new lending rules were introduced by the Financial Conduct Authority (“FCA”) which introduced stricter requirements for both the mortgage lender and the borrower. In short, mortgage lenders are now responsible for assessing whether borrowers can afford the loan in the long term. This can include those who are looking to re-mortgage.

Why has this happened?

The rationale behind this change is to ensure that borrowers are issued with mortgages which they can afford both now and in the future.

Following the housing market crash in 2007 interest rates were rock bottom; now that the economy is steadily improving and property prices increasing, interest rates are expected to increase. The FCA do not want a return to the pre 2007 times where borrowers borrowed too much and struggled with repayments resulting in re-possessions and many people stuck in properties with negative equity.

So what does this mean for me?

There is a requirement for you to take financial advice from either the lender, a mortgage broker or financial advisor in order to find the best deal for you taking into account all your circumstances and whether you can realistically afford the mortgage now and in theanticipated future with higher interest rates - known as “stress-testing”.

There are 27 questions you can expect to be asked ranging from how much do you spend on socialising to have you ever taken out a pay day loan. You will also need to supply detailed proof of earnings for at least 3 months but more likely 6 months. Self-employed people and contract workers will likely receive tougher questions.

These rules are still very new and at this time we have not received any formal statistics on how they have affected borrowing; however experts have warned that thousands of borrowers are likely to be rejected if they do not meet the new requirements.

If you are thinking of buying a house and would like to talk about the legal process involved in purchasing property, please call the conveyancing team for a free no obligation consultation on 0113 320 5000.

Client feedback

As a first time solo buyer, I had no idea what I was doing with buying a house. Samantha at Winston Solicitors was incredible, her and her team explained everything and everytime I had a question (which was often) they responded quickly and in a way that was easy to explain. Using Winston Solicitors made the house buying process so easy and quick, from the initial viewing of the house to completion, it was only 12 weeks! After hearing horror stories of a long buying process, I couldn't be more happy to have worked with an amazing company! If you are looking for a solicitor for your house purchase, I would highly recommend Winston Solicitors!
Ms M
We recently worked with Leasa Foster at Winston Solicitors as our solicitor for purchasing our new home, and we couldn’t be happier with the experience. Leasa was incredibly professional, thorough, and proactive throughout the entire process. She kept us informed at every stage, explained everything clearly, and always responded quickly to our questions — no matter how small.Buying a house can be stressful, but Leasa made the whole journey smooth and straightforward. Her attention to detail and calm, reassuring approach gave us complete confidence that we were in safe hands.We are truly grateful for her support and highly recommend Leasa Foster and Winston Solicitors to anyone looking for an efficient and reliable conveyancing solicitor.
Pranjali
I recently used Winston to help with the purchase of my new home. From start to finish, the service was excellent. Leads Foster was professional, efficient, and always kept me informed throughout the process. Every question I had was answered promptly, and everything was explained in a way that was easy to understand. The whole transaction went smoothly and on time, with no hidden surprises. I really appreciated the clear communication and friendly approach. I would highly recommend to anyone looking for a reliable and trustworthy solicitor.
Pranjali
What can I say Leasa was amazing from start to finish with great communication throughout, I would highly recommend Winston solicitors.
Philippa
As first-time buyers, we chose this Winston Solicitors because of their great reviews, and they absolutely lived up to the expectations! Amr and Joe were extremely helpful and always quick to respond - we never had to chase anything up or wait long for updates. The whole process felt smooth and well-managed from start to finish. We couldn’t have asked for a better experience and would definitely recommend them to anyone buying their first home!
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I had a very good service from Michelle Ayres when selling. She was very helpful and prompt responding to any questions I had. I would recommend Michelle to others.
Anonymous
We can’t thank Leasa enough for all her help in purchasing our dream home. From start to finish, she was professional, proactive, and always one step ahead. Nothing was ever too much trouble, she kept us informed at every stage, explained things clearly, and made what could have been a stressful process feel smooth and well-managed.Leasa’s attention to detail and calm, reassuring approach gave us total confidence throughout. We’re so grateful for her support and would recommend her to anyone looking for a solicitor who genuinely cares about getting the best outcome for their clients.Thank you Leasa, we couldn’t have done it without you!
Jonathan
We had a great experience with Michelle as first time buyers. She was very professional and incredibly fast throughout the whole process. Even when we held things up a bit on our end, she was quick to respond and answered all our questions clearly and promptly. We would definitely recommend. Thank you.
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