PPI Claim News - 10/2/2011
Loan insurance: Lenders 'capping' mortgages
The UK's biggest mortgage lenders are placing a cap on the amount families can borrow, with couples without children able to borrow up to 50 per cent more than those with youngsters.
Melanie Bien, of mortgage ¬broker Private Finance, told thisismoney.co.uk that parents do not have the same access to money as their childless counterparts because they are considered to have more outgoings.
Ms Bien is quoted as saying: "Couples with children are being penalised by mortgage lenders.
"The rationale is that they have higher outgoings, so can't afford as big a mortgage, but this seems unfair when their social lives will be more limited and therefore cost less."
According to the news provider, this 'child penalty' is used by most of the major mortgage lenders. It reveals that Santander would lend £237,625 to a couple with no children and a gold-plated credit score, but only £219,485 if they have two children.
John Fieldman
Having worked in the city for 19 years, John's main focus is interest rates and corporate finance.

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