Kensington Mortgages removes three months saving requirement for borrowers

Kensington Mortgages removes three months saving requirement for borrowers

 

The lender introduced the criteria at the start of the pandemic which required potential borrowers to have evidence of savings for the period to cover mortgage payments in case income became unstable.

In a note to brokers, Kensington Mortgages also said it would accept income evidence for SEISS and Business Support Grants, Job Retention Scheme Payments and Bounce Back Loans as well as Coronavirus Business Interruption Loans.

Brokers recently told Mortgage Solutions that attitudes to government support and grants remained mixed from lenders, with some taking a more cautious approach if a borrower had taken forbearance.

The lender also said it would accept cases where employees had been on furlough, as long as it was not in the last three months.

A Kensington Mortgages spokesperson said: “As we entered the pandemic, we tightened our lending criteria to ensure we continued to lend responsibly in a very uncertain macroeconomic environment.

“As we now start to exit the pandemic, it is only right that we should loosen some of these extra checks that were put in place. We are also pleased to provide clarity on how we will treat funds raised through some of the government support schemes by self-employed borrowers.”

Speaking on a webinar this morning, Kensington Mortgages new business director Craig McKinlay said the self-employed market was “massively important” to the lender and around half of its business came from this area.

He also said the lender would be introducing flexible products which would allow brokers and customers to elect last year accounts if they had a good year or use an average over the past two years if it was not.

“I think we are going to get more and more self-employed people.

“So having those kinds of flexible policies and really trying to understand what happened and understand where things were just a one-off, for instance government grants and furlough income, means that we can take the vanilla and the spice,” he explained.