Brendan Burgess
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The LTI limits are a very crude measure.
I would not lend 3.5 times the income to someone on €20,000.
I would consider 4 times the income to someone on €100k as they would have far more disposable income.
I would lend a much higher multiple to couple of 25 year old newly qualified accountants than I would to a 35 year old bus driver as I would expect their income to rise faster
So the right solution is the net affordability. But that would be impossible for the Central Bank to codify.
So let the lenders operate their own limits on income.
In any event, there is a strong correlation between Loan to Income and Loan to Value.
Brendan
I would not lend 3.5 times the income to someone on €20,000.
I would consider 4 times the income to someone on €100k as they would have far more disposable income.
I would lend a much higher multiple to couple of 25 year old newly qualified accountants than I would to a 35 year old bus driver as I would expect their income to rise faster
So the right solution is the net affordability. But that would be impossible for the Central Bank to codify.
So let the lenders operate their own limits on income.
In any event, there is a strong correlation between Loan to Income and Loan to Value.
Brendan
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