One broker highlighted how the disparity in underwriting standards between mortgage loans and personal loans/credit cards creates a 'debt paradox,' hindering borrowers from securing mortgages amidst existing high-interest debts. Urged FCA to address flawed lending practices.
Harps Garcha pointed out the mystery in how lenders assess affordability differently for mortgages and personal debts, citing a case where a client with substantial consumer debt and low income is still extended credit. Emphasized the lack of affordability checks in certain credit facilities.
Ranald Mitchell criticized the unsecured credit practice in the UK as scandalous, targeting vulnerable households. Noted the reckless lending and disregard for long-term consequences by lenders, contrasting the stringent checks for mortgages with lenient practices in unsecured credit issuance.
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