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<p>The Financial Conduct Authority Handbook sets out rules and guidance for lenders.
This provides that, prior to entering into a mortgage, a lender must assess whether
the customer will be able to pay the sums due and must not enter into the transaction
unless it can demonstrate that the mortgage is affordable for the customer (and any
guarantor).</p><p> </p><p>It is up to individual lenders to determine how to ensure
adherence to this requirement. Each lender is required to publish a written statement
setting out the factors it will take into account in assessing a customer's ability
to pay. This must, inter alia, address how income and expenditure is to be assessed,
including details of the types of income which are acceptable.</p>
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