Mortgage value restriction 'would not work'

Proposals that would see the maximum available mortgage finance being limited to 350 per cent of consumers' household income would not be a good idea.

That is the opinion of Catherine Hearnden, director of My Mortgage Direct, who believes any such changes to the sector would be "ridiculous", primarily due to the fact they do not take into account differences in personal circumstances.

This alteration, along with measures to implement a loan-to-value cap of 90 per cent on home loans, was suggested in a report by the Institute for Public Policy Research published last week (May 31st).

However, Ms Hearnden insisted this fails to consider that "every household has different expenditure", depending on factors such as whether they have children or not.

"One household might have five kids and one might not have any. Also, they might have other commitments and you don't know what sort of jobs they have," she added.
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06/06/2011 15:09

News category: Property

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