High street playing fast and loose with self-certification?

Amanda Jarvis

March 6, 2002

Verso said the survey was worrying from the point of view that a greater relaxation of lending criteria could just be storing up problems for the future.

Eddie Smith, director of business development at Verso, said: “Under the forthcoming regulation self-certification should be fine, but this does not mean there should be no checks whatsoever. It comes down to whether you want to be in the responsible lending area, where you are surely aiming to keep the people in the property? There should always be some checks to see if the borrower can afford the mortgage.”

The survey found that in some cases a lower loan to value loan would result in fewer checks.

“You can either take the view that 75 per cent and under is OK (you can always get the house back on default) or you can go down the responsible lending route and continue to do checks. An interesting debate,” said Smith.

The survey was carried out by Verso’s regional sales force, who questioned a number of their key introducing brokers and both regional and national packagers.

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