13 March 2018

Couples must beware of overstretching themselves with mortgage lending - Royal London

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Helen Morrissey, Personal Finance Specialist

Helen Morrissey

Personal Finance Specialist

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Commenting on the FCA’s Mortgage Lending statistics that were published today Royal London’s Personal Finance Specialist Helen Morrissey said:

"The Bank of England has taken steps to keep a lid on so called risky lending with affordability criteria coming into play. Despite this today’s figures show that in Q4 2017 38.43% of loans issued on a joint income basis were done so at an income multiple of three times or more. This is up from 26.42% of such loans in Q4 2007.

While house price growth has outstripped wage growth in recent years it is important that people do not overstretch themselves as they try and get a foothold on the housing market. While such an amount may feel affordable right now couples need to consider how they would manage in the event of any increase in interest rates or if one partner lost their job and ensure appropriate safeguards are in place."

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For further information please contact:

Helen Morrissey, Personal Finance Specialist

Notes to editors

FCA Mortgage Lending statistics can be found here - https://www.fca.org.uk/firms/mortgage-lending-statistics 

About Royal London:

Royal London is the largest mutual life, pensions and investment company in the UK, with funds under management of £117 billion, 8.8 million policies in force and 3,745 employees. Figures quoted are as at 30 June 2018.