Are you about to apply for a mortgage? New rules being introduced this month means it is not going to get any easier.


If you thought applying for a new mortgage was tough following the credit crisis, it is about to get a whole lot harder, according to the Council of Mortgage Lenders (CML).

The CML recently issued five warnings to borrowers ahead of the new regulation which will come into effect on April 26.

1. Taking out a mortgage could take longer than before. This is because most mortgages are sold on an ‘advised’ basis and the new rules are very prescriptive about giving advice, with an advised sale possibly taking up to two hours.

2. You will need to provide more details about your income and expenditure. The new rules require a detailed assessment of whether your mortgage is affordable both now and in the future

3. The new rules could affect how much you can borrow. Lenders will be required to ask detailed questions about your spending, including what you spend on utilities, council tax, telephones, ground rent, insurance and running a car. They will also have to make a realistic estimate of other living costs, including clothing, household goods and childcare costs.

4. You will be able to apply for a mortgage on an “execution-only” basis, but there are strict rules to make sure that you understand the process. You will need to show you have researched the market and understand the features of the mortgage you want to take out.

5. It will still be possible for you take out an interest-only mortgage – but this will remain a niche offering. Lenders continuing to offer interest-only mortgages will need to ensure that you have a credible strategy for repaying the loan when it matures.

Of course all these measures are designed to help us fully understand the level of borrowing and type of product we are signing up to, however with this comes more admin and paperwork, so in a fast moving market planning and getting your paperwork in order can be the difference of a sale being agreed or losing a buyer or property.

Whether you’re looking for a competitive rate on a new mortgage or to re-mortgage, or looking to save money on your home insurance or your utility bills the Zoopla Finance Centre is the place to look. Start saving money today by visiting here.

Some information contained herein may have changed since it was first published. Zoopla strongly advises you to seek current legal and/or financial advice from a qualified professional.

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