BANKS WILL BE able to extend the period for which its customers have secured mortgage approval during the current Covid-19 crisis, the Banking and Payments Federation Ireland (BPFI) has said.
The representative body said it was aware that some of those who are further along the application process may be worried that the present situation will affect this process.
While lenders are facilitating drawdowns within normal timeframes where the standard requirements have been fulfilled, the BPFI said that there may be some delays that are “due to factors beyond the lender’s controls”.
In new guidance published this morning, it said banks remain open for businesses for new mortgage applications and are operating “as effectively as circumstances allow”.
When it comes to extending mortgage approval, lenders will be able to do so in circumstances where the customer’s circumstance has not materially changed, subject to standard income and affordability checks.
The BPFI said: “And for those who have a mortgage approval but who have unfortunately experienced income loss due to Covid-19, a lender can keep this application open on its system for a period of time after which it can be reviewed and the customer can provide an update on his/her employment and income situation.
This approach is considered to be clearly in the interest of both the customer and the lender in ensuring that mortgages are not extended to those who cannot now or in the immediate future afford them.
It added that delays to the application process could arise where a valuers aren’t able to conduct a full inspection of a property or legal practitioners can’t access everything they need to complete all the steps in buying a property.
BPFI CEO Brian Hayes said: “At whatever stage applicants may be in the mortgage process, should they have any concerns we would encourage them to read the information available on the BPFI’s website in the first instance, and if they have any further questions beyond that to contact their lender who will advise them on their particular situation.”
The industry body has a FAQ on mortgages here.