Brokers have expressed shock at the timing of Abbey's move to tighten its affordability calculations, but have admitted it is now inevitable other lenders will now follow suit.
Abbey has informed brokers that from tomorrow it will no longer use its standard variable rate - which currently stands at 5.44% - to determine a borrower's mortgage commitments, instead using the figure of 7%. Ray Boulger, senior technical manager at John Charcol, says that calculating the affordability based on an SVR we are unlikely to see for some time is "rather onerous". He explains: "Abbey has been one of the more generous lenders in terms of affordability for some time, so this is probably a way of addressing that, but it seems rather odd. If you have borrowers taking on a 25 year...
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