Stemming from the Mortgage https://www.beaconfinancialtraining.co.uk/wp-content/uploads/2020/06/cemap-online-and-classroom-training-uk.jpget Review (MMR) that was conducted by the Financial Conduct Authority (FCA) in April 2014, increased regulation and tougher lending criteria mean that even those who are up to date with all of their mortgage repayments are being refused the chance to remortgage to a cheaper rate.
Lenders have been accused if not interpreting the rules correctly, and deny that they have done so to make more money. The end result is that by telling customers they do not meet the current lending criteria, they are paying more by becoming stuck on their existing rate.
Experts have said that this is reflected in the drop in the number of people remortgaging and is without doubt a result of the MMR, which implemented a more stringent assessment of affordability and a need to prove that the borrower could still afford to repay should rates rise in the future.
Now though, lenders stand accused of declining existing borrowers whose repayments would be decreasing if they were able to change product.
Lenders have responded by saying that they are fearful of not adhering to the regulation enforced by the FCA, and have called for additional clarity on the process. The FCA has responded by stating that it is reviewing how the MMR is being applied, and says that some lenders are not applying ‘common sense’.
As a mortgage advisor, you must complete your CeMAP training and pass the end exam in order to assess affordability, and advise customers in line with your employer’s processes and procedures.
