FCA Helps Mortgage Prisoners

The Financial Conduct Authority (FCA) has now suggested changes in how lenders assess customers for lending purposes in a recent final report.

Mortgage customers that have been prisoners and have not been able to switch their mortgage even though they have been up to date with their payments should now see some ‘light at the end of a tunnel’.

The FCA reported in their Mortgages Market Study that the mortgage market seems to be doing well, but things can be made better outlining some new lending rules guidelines:

• Lenders taking a more active role in helping customers quickly recognise the mortgages they qualify for.
• Single Financial Guidance Body (SFGB) needs to extend its retirement directory and include mortgage intermediaries this will help customers have a wider choice of brokers available to them.
• Changing mortgage advice rules and guidance in helping remove potential barriers to innovation.
• Looking at customers that haven not switched mortgage and help them understand their choices and guide them in the right decision.

Executive Director of Strategy and Competition at the FCA Christopher Woolard said “The mortgage market is working well these new lending rules and changes will benefit consumers in finding the right mortgage and the mortgage prisoners to be able to switch to a more affordable mortgage”.

The FCA has agreed lenders will be able to provide an easier assessment for customers that are up to date with their mortgage payments, that do not wish to borrow more the chance to move to a better mortgage rate.   Lenders will be able to look at inactive lenders and administrators customer records and contact customers to advise them and help them switch their mortgage.