Calculators could halt self-cert mis-selling

Mortgages PLC says affordability calculators could stop the mis-selling of self-cert mortgages.

The Financial Services Authority last week said 47% of cases it reviewed in a mystery shopping exercise failed to show affordability had been appropriately assessed by brokers, with a further 36% failing to suitably explain why they’d recommended self-cert.

MPLC says it is possible self-cert mortgages are being inappropriately recommended because they allow borrowers to get larger loans than they could using income multiples.

Peter Beaumont, sales and marketing director at MPLC, says: “If gross income is the problem, affordability calculators are a solution.

“Borrowers unencumbered by large debts and with modest expenses can usually borrow more using an affordability calculation than income multiples would permit.”