Mortgages: Government Assistance

(asked on 21st February 2020) - View Source

Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what recent discussions he has had with representatives from the (a) Financial Conduct Authority and (b) UK Finance on mortgage prisoners.


Answered by
John Glen Portrait
John Glen
Paymaster General and Minister for the Cabinet Office
This question was answered on 26th February 2020

Treasury Ministers and officials have meetings with many organisations in the public and private sectors on a variety of issues. The Treasury is discussing the issue of mortgage prisoners with consumer groups, mortgage lenders, the Financial Conduct Authority and UK Finance.

A mortgage prisoner is defined by the FCA as an existing customer that may be experiencing harm because they are unable to switch to a better deal. The Government is aware that these borrowers have been in a difficult and stressful situation. That is why we have worked closely with the FCA to implement their rule change to remove the regulatory barrier that has prevented some customers from switching.

Lenders are currently making the necessary adjustments and system changes to enable them to use the modified affordability assessment for borrowers looking to re-mortgage. We expect lenders to start offering these borrowers products using the new rules in Q2 2020.

I have written to Stephen Jones, Chief Executive Officer of UK Finance, to outline my expectation that as many of its members as possible should move quickly to offer new deals to borrowers that are eligible to switch under the new FCA rules.

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