Over seven out of 10 (72%) mortgage brokers believe lenders are now too risk averse as a result of the Mortgage Market Review (MMR), including 23% who say they have become excessively so, according to research commissioned by EDM Mortgage Support Services.

Brokers are also divided on whether the risk assessments of mortgage borrowers are more accurate now as a result of MMR, with 45% saying it is and 39% saying this is not the case.

The MMR, which took effect in April this year, has impacted the administrative burden on mortgage brokers, with all brokers in the survey say they are spending more time on processing sales as a result of the MMR and 60% saying the rise in time spent has been significant.

Joe Pepper, managing director at EDM MMS said: “The MMR was always going to increase the administrative burden on mortgage brokers, it was just a question of how much. But the jury is clearly still out on whether the risk assessments under the MMR have actually been worthwhile.

“The Bank of England’s Inflation Report in August highlighted that the MMR had impacted mortgage approvals. The volume of approvals in Q2 averaged 64,000 per month, which was significantly lower than the 70,000 that the BoE had predicted in May. Also, while the BoE predicted mortgage approvals would rise to 85,000 a month by Q4, it expected that this would in fact be 75,000 due to the MMR’s ‘persistent effects’.”