Platform launches affordability based lending model

Platform, the intermediary lender of Britannia, is delighted to announce the launch of its new affordability-based lending model.

From today, Platform will change from an income-multiple based approach to a new debt to income ratio-based model which offers a more accurate calculation of a borrower’s ability to repay.

Affordability considers income and financial commitments rather than purely a multiple of a borrower’s current salary and the equity in the property (the Loan to Value position).

The new model will apply to Platform’s products across the range (except Buy to Let) with immediate effect for all new applicants and will be supported by an affordability calculator which is now live on Platform’s website. The calculator is designed to be quick and easy to use, and requires just a few simple facts to calculate the indicative maximum loan amount. It does not require specific personal details and there is no need to produce a KFI first.

Phil Riches, Divisional Sales Manager at Platform said: “As a responsible lender we believe it makes more sense to look at a mortgage applicant’s full financial circumstance, including money they owe, financial commitments and income, and to lend based on what they can afford to pay back each month. We also believe this will help homeowners by giving a more scientific calculation of what they can afford resulting in less people getting into financial difficulties and mortgage payment arrears.

“Our new affordability calculator will help our clients to identify the most appropriate product for their customers by allowing for customer-specific considerations to be taken into account, such as the number of dependants and outstanding commitments. It also supports Platform’s continual focus on treating customers fairly.”