Demand for home properties could slow as the new Mortgage Market Review comes into play on April 26 with new regulations being introduced that will make mortgage lending more cautious.  Lenders will be required to have a stronger approval process to assure that borrowers are taking on mortgages they can afford.  Due to the stricter process, demand is expected to rise as borrowers seek to gain a deal before the tougher regulations are a requirement.

Paul Smee, director general with the Council for Mortgage Lenders, said, “The introduction of MMR regulation will bring the largest change to how the mortgage market works in over a decade. The industry has shown that it is ready, and we anticipate a smooth transition into the new framework. We hope and expect the new rules will provide a robust and stable framework for the long term.”

Some lenders have adopted the new lending rules long before the implemental deadline.  The transition will therefore not be a stiff break in lending rules.  Many borrowers will have entered into a mortgage process with lenders that are already operating under the more cautious rules. 

Homeowners are due to receive mortgage advice from lenders which is meant to help them make better choices for their budget and needs while entering into a home purchase that is affordable.  Borrowers should expect longer processes than in months and years back with the new rules for both mortgages and remortgages.

The Financial Conduct Authority submitted a statement that said, “We are taking a common sense approach to mortgage lending to help protect against the bad practices in the run up to the financial crisis that saw people get mortgages they simply couldn’t afford. Under our new rules, anyone that can afford a mortgage will be able to get a mortgage.”