The procedure of obtaining mortgage lending in the UK is complicated

New data on the level of optimism in the mortgage market of great Britain for 2015 indicate that the market sentiment is very conservative. A recent study from the International Association of Mortgage Lenders shows that more and more customers are unable to get a mortgage for one reason or another. ( Mortgage UK)

Approximately 84% of mortgage brokers in the real estate market of the United Kingdom stated that for the last 6 months they got at least one client, which they are unable to help in getting mortgage credit. Just 6 months ago – in July 2014, it was stated by 78% of brokers.

Limited access to financing are primarily private entrepreneurs, pensioners and people with low incomes.

About 74% of mortgage brokers believe that the terms of the mortgage products have significantly deteriorated over the past 6 months.

Those borrowers who are denied access to the credit market can be divided into two groups – 1st group – those who have little income and group 2 – those who live in rented accommodation and have a few family members – dependents.

On the one hand, the protection mechanisms of the mortgage market that is actively developed and implemented by the Bank of England is vital, as insurance against massive defaults and financial collapse of the entire construction industry. On the other hand, when mortgage lending are deprived of the most vulnerable members of society – families with young children, I suppose, the pendulum of regulation has swung too far.

The mortgage market is just being formed after the introduced changes. In the process of its formation it is important to understand what effect the new rules have had on certain groups of consumers. It is important to establish regulatory frameworks that would allow to obtain the credit the maximum number of people-representatives of different social groups and at the same time would work as protective tools in case of force majeure.

® Alice Morgan 06.02.2015

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