Haircuts, pet insurance or the gym could stop you getting a mortgage under new lending rules

New lending rules will see potential mortgage holders forced to submit bank statements and face hours of grilling over their ability to pay.

 A clampdown starting tomorrow means all lenders not only must prove they can easily afford monthly payments but can continue to pay if interest rates rise.

The so-called stress-test, part of the Financial Conduct Authority’s new mortgage regulations, hopes to avoid a return to the toxic loans which led to the collapse of lenders such as Northern Rock and Bradford & Bingley.

Those applying for mortgages will now need to supply detailed evidence of their income and their outgoings, and face hours of questioning from lenders.

What could be taken into consideration?

Changes will mean more attention is given to how borrowers spend their money.

It’s likely regular outgoings, such as subscriptions, pensions, childcare costs, school fees, gym memberships, pet insurance, mobile phone contacts and even haircuts will be taken into consideration.

While some advisors have said some of the checks are unnecessary, the FCA has said it shouldn’t affect the number of people getting mortgages.


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