Mortgage enquiries from self-employed applicants who failed to find an affordable loan jumped by almost a third following last September mini-Budget, data from Mortgage Broker Tools shows.
The criteria platform says that prior to the tax-cutting fiscal event by former Chancellor Kwasi Kwarteng, 28% of mortgage enquiries from self-employed applicants were unable to achieve the loan size requested as they were considered unaffordable.
But after the mini-Budget, this number lifted to 37% of self-employed home loan enquiries that were considered unaffordable by lenders.
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Current Chancellor Jeremey Hunt reversed almost all of Kwarteng’s tax-cutting measures, which had caused UK borrowing on international money markets to rise in October and his Autumn Statement in November, calming rates. The Chancellor presents his full Budget on Wednesday (15 March).
“In recent weeks, competition has returned to the market, with lenders cutting rates and offering more achievable stress testing,” adds the criteria platform.
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Mortgage Broker Tools chief executive Tanya Toumadj says: “As we saw from the mini-Budget last autumn, fiscal policy statements can have a significant impact on financial markets, interest rates and ultimately the accessibility of mortgage finance, so we’ll all be watching closely to see what the Chancellor has to say at the dispatch box.
“It’s unlikely that this Budget announcement will have quite such a dramatic impact on mortgage affordability, but even small changes can have a potentially huge impact on the prospects for individual clients, particularly in the current uncertain economic environment.”
By Roger Baird
Source: Mortgage Finance Gazette