Ipswich moves to help mortgage misfits
The Ipswich says that whilst many lenders will allow their own customers to refinance their loans without passing affordability they won’t consider those moving from other lenders.
And the society warn that this is creating a group of ‘mortgage misfits’ that fall outside the usual system.
The Ipswich’s new lending programme is aimed at helping these borrowers and the society will now consider these cases as long as the borrower is not increasing their loan and their circumstances have not changed.
Paul Winter, chief executive of Ipswich Building Society, said: “We are standing up for mortgage misfits who are often overlooked by lenders who insist on machine-only application processes. It is possible to still give people a choice while retaining a diligent approach to lending.
“I’m aware that some lenders do not offer transitional arrangements to their existing borrowers, let alone new applicants, and I believe the sector should consider its responsibilities to existing borrowers who have consistently made their mortgage repayments and who otherwise would be classed as ‘good customers’.
“Speaking to the financial services sector, I would urge my peers at other lenders to think about making the mortgage market work more effectively for mortgage misfits by offering choices for those who fall outside the norm.
“Our advantage as a mutual, and as a business which takes a human-centered approach to verifying income, means we can continue to operate in the best interests of our members and future members.”
Broker Sebastian Murphy of JLM is one of the broker firms signed up by Ipswich Building Society to offer mortgages under its new transitional lending programme.
Murphy said of the launch: “MMR has stimulated a new focus on lenders and brokers working together to meet the needs of borrowers.
“I have been staggered how many of the larger lenders have seemed to hesitant to apply transitional arrangements available under MMR and this has limited the choice available to existing mortgage holders.
“Working with Ipswich Building Society means we can offer our clients with existing mortgages who do not meet the required affordability criteria additional choice. I hope other lenders will soon follow suit.”