Cat Standard Mortgages

What Do CAT Standard Mortgages Offer

CAT Standard Mortgages are not a panacea. They do not carry any government guarantee, they will not suit every type of property purchase and they may not offer the best option in respect of charges and monthly repayments for every borrower.

However, what CAT Standard Mortgages do offer is transparency.

The CAT Standard is voluntary for mortgage providers. Whether to offer CAT Standard Mortgages is a marketing decision for the individual lender. If a lender does provide this type of product, it will be clear from the associated promotional materials. Meeting (or bettering) an official benchmark for clarity and fairness makes commercial sense for many mortgage providers.

If they offer CAT Standard Mortgages, lenders must make them available on identical terms to new and existing customers. The CAT Standard does not lay down rules regarding income multiples for calculating how much can be borrowed. Nor does it specify a minimum deposit value to be put down by a borrower; these factors are commercial decisions for the mortgage provider.

Existing customers are entitled to re-mortgage to a CAT Standard Mortgage, provided that they meet all criteria relating to the value of the property and the ability to make repayments.

Lenders are permitted to define the minimum value of a loan. The current minimum for a CAT Standard Mortgage cannot be greater than £10,000. The maximum value is at the discretion of the lender.

Limitations of Voluntary Scheme for CAT Standard Mortgages
Because the CAT Standard Mortgage scheme is voluntary for mortgage providers, no obligation exists to provide CAT Standard Mortgages to every borrower for every possible mortgage request. The lender’s financial judgement regarding the suitability of the property and the ability of the borrower to make repayments remains paramount. Nevertheless, the mortgage provider is obliged to make CAT Standard Mortgages available to all applicants who meet the selection criteria; restricting access to an arbitrarily chosen group of borrowers is not permitted.