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3d ago

FCA Proposes Streamlined Mortgage Rules to Lower Costs for Homeowners

The UK regulator launches a consultation on simplifying affordability assessments and borrower-lender interactions, with feedback open until June 4.

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Remortgage rates have tended to be more expensive than rates for homebuyers because homeowners find it difficult to switch lenders

Overview

  • The Financial Conduct Authority (FCA) has unveiled proposals to make mortgage modifications easier, faster, and more affordable for homeowners.
  • Key changes include removing the requirement for full affordability assessments when borrowers reduce their mortgage term, potentially lowering overall borrowing costs.
  • The consultation aims to simplify responsible lending and advice rules, with a focus on improving access to advice while expediting the process.
  • The FCA will monitor the effectiveness of these changes through firm supervision and complaints data, ensuring consumer protection under the Consumer Duty framework.
  • A broader public discussion on the future of the UK mortgage market is scheduled for June 2025 to address long-term housing and economic challenges.