View more on these topics

FCA: ‘Lenders increasingly using MMR transitional arrangements’

FCA interior 620x430

Lenders are increasingly using the transitional arrangements written into the MMR to stop borrowers becoming trapped, says the FCA.

The transitional arrangements have been a hot topic of late and lenders have come under fire for their reluctance to use them.

They allow lenders to waive affordability checks for borrowers who may be trapped under the new rules as long as the customer does not wish to borrow more money, there is no “material impact” on affordability and they have a good payment history. They can be applied to existing borrowers and borrowers from other lenders.

While many of the bigger lenders have been criticised for not using the arrangements as they were designed – especially with borrowers transferring from other lenders – smaller players like Ipswich and Melton Mowbray building societies have actively targeted these customers.

But speaking at the Intermediary Mortgage Lenders Association’s Great Mortgage Debate in London yesterday, FCA mortgage and mutual sector manager Lynda Blackwell said the situation is improving.

She said: “Firms are increasingly using the transitional arrangements. We are seeing that.”

However, mortgage prisoners were dealt a blow recently after it emerged that lenders will have to apply affordability checks on all remortgage customers who come from rivals as part of the Mortgage Credit Directive, therefore making part of the arrangements redundant.

Recommended

Baldwin-Harriett.Conservatives.Dec2013
1

Treasury offloads Pension Wise to DWP

Government-backed guidance service Pension Wise is to move from the Treasury to the Department for Work and Pensions. Economic secretary to the Treasury Harriett Baldwin told the DWP select committee today the DWP would be taking responsibility for the new service during this financial year. She said: “We have decided to make a machinery of […]

FSCS-Piggy-Bank-500x320.jpg
6

FSCS director of operations steps down

Financial Services Compensation Scheme director of operations Kate Bartlett has stepped down from the organisation. Bartlett joined the FSCS in 2010 and was a member of its board. An FSCS spokeswoman says the lifeboat scheme is seeking a replacement who will take on the newly-created role of chief operating officer. The spokeswoman says: “Our service […]

Singapore cover image - thumbnail

White paper — Singapore International Insights

Jelf Employee Benefits assesses key trends within the international private medical insurance provision of organisations with employees in Singapore. Benefit structure, cost management and healthcare facilities are examined and key considerations are highlighted. This edition will be of particular interest to global human resource directors and benefit managers with local and expatriate populations in Singapore.

Newsletter

News and expert analysis straight to your inbox

Sign up

Leave a comment