From 1st July the Council of Mortgage Lenders is integrated into a new trade association, UK Finance. For the time being, all UKF mortgage information will continue to be published on this website, and UKF member-only mortgage information will only be available here.

UK Finance represents around 300 firms in the UK providing credit, banking, markets and payment-related services. The new organisation takes on most of the activities previously carried out by the Asset Based Finance Association, the British Bankers’ Association, the Council of Mortgage Lenders, Financial Fraud Action UK, Payments UK and the UK Cards Association. Please go to www.ukfinance.org.uk for wider content and updates from UK Finance.

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CML comments on PRA's underwriting standards for buy-to-let mortgages

Published: 29 September 2016

The Council of Mortgage Lenders notes that the PRA's underwriting standards for buy-to-let mortgages, published today, reflect many of the proposals set out in the CML's consultation response.

The CML is pleased that the PRA has confirmed that buy-to-let mortgages with terms less than five years, or rates fixed for five years or more, are not subject to the affordability stress test. The CML also welcomes the PRA's decision to adopt the CML proposal that firms be given three months to implement the IRC and interest rate affordability stress test but have a year to meet all other regulatory requirements.

CML director general Paul Smee commented:

The new underwriting requirements broadly reflect existing practice, as the PRA says. While the regulator will need to keep the impact of the new requirements under review, we expect the effect to be modest under current market conditions, and we do not anticipate the measures resulting in any shock to the market.

 

Notes to editors

1. The Council of Mortgage Lenders' members are banks, building societies and other lenders who together undertake around 97% of all residential mortgage lending in the UK. There are 11.1 million mortgages in the UK, with loans worth over £1.3 trillion.

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