Landlords in turmoil after Bank of England mortgage affordability test bombshell
The buy-to-let time bomb is ticking. Recent recommendations by the Bank of England suggest dropping the affordability test for mortgage lenders, spelling the end of the buy to let market as we know it, according to Sterling Capital Group Ltd.
Historically, borrowers have been subject to two test recommendations: the ‘flow limit’ which limits the number of mortgages that can be extended at loan, and the ‘affordability test’ which specifies the stress interest rate for lenders. The tests were originally put in place after the 2008 financial crash as insurance against further economic downturn. To continue reading, please click here.
Source: Property Reporter