Preferred removes income multiples

Amanda Jarvis

June 5, 2006

Intermediaries can determine the maximum amount their customers can borrow by using Preferred ’s online affordability calculator.

Roger Taylor, director of sales and marketing at Preferred, said: “A set income multiple formula does not take into consideration an individual ’s personal circumstances,such as any existing outgoings. Calculating someone ’s ability to repay based on affordability is a much fairer and more accurate representation. The crucial factor is that they can afford to repay the loan.

“Our online affordability calculator gives intermediaries a quick but accurate response to the two most important questions: 'How much can my customer borrow?' and 'Can they afford the proposed repayments?’ In addition,it provides intermediaries with peace of mind that the application being submitted fits our affordability criteria.”

The decision to remove income multiples coincides with the launch of Preferred ’s product range.

Highlights of the product range include:

-No income multiples across the entire range
-Enhanced adverse criteria -including the introduction of a new adverse level: Near Prime Extra
-Discounted rates from 4.06 per cent
-A range of fixed rates, including a two-year fixed rate product
starting at 5.14 per cent with no extended tie-in
-Increased underwriting flexibility and stretched adverse criteria
-‘Either or ’option extended to the light range

Taylor continued: “The decision to remove income multiples further reflects Preferred ’s flexible approach to underwriting.These enhancements to our product range demonstrate our commitment to continually improve our range of products and the service levels we offer.”

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