Put simply, those who bought properties under the measures are better prepared to manage their mortgage payments in the event of a future downturn in the economy. The framework requires borrowers to satisfy two requirements. First, a household can borrow a maximum of 3.5 times its gross annual income (known as the loan to income, or LTI, ratio).
But before I go any further, I should begin with the usual disclaimer that my views are my own and do not necessarily reflect those of the Federal Reserve System or my colleagues on the Federal Open Market Committee (FOMC). The theoretical justification for rules The theory part of this session’s title is well established.