Don't Eat Steak!
 January 5 2016     Posted by Siemens Group

http://www.dailymail.co.uk/money/mortgageshome/article-2625808/Want-mortgage-Dont-eat-steak-Revealed-Bizarre-questions-new-home-loan-crackdown.html

I thought I would share this Daily Mail story that outlines how UK lenders are tightening the circle as to whom they will lend to. Lenders are interviewing mortgage applicants on their lifestyle choices before they decide whether they will lend to the applicants. Some of these interviews are reported to be over 3 hours long, where the applicants are pelted with personal questions ranging from plans to expand their families to how often do they dine on steak.

Apparently this is in response to Mortgage Market Review by the Financial Conduct Authority that took place between 2009 and October 2012 in the UK. It was deemed that the lenders must ascertain whether the consumer could really afford the mortgage. “The new ‘stress tests’, which aim to check whether a borrower could cope with higher interest rates, are being blamed for gridlock in the property market as buyers struggle to finance a house move. A report out later this week will show that remortgage applications in the UK fell by 12 per cent last month.

Martin Wheatley, who is behind the changes as chief executive of the FCA, has insisted the rules were ‘hardwiring common sense’ into the mortgage market.

Let’s hope Canada doesn’t see this new legislation and think it is a good idea!