Regulatory Alerts2019-03-25
Added · Updated
PS19/27: Changes to mortgage responsible lending rules and guidance – feedback on CP19/14 and final rules
The Financial Conduct Authority amends responsible lending rules to allow mortgage lenders to use a modified affordability assessment for consumers who are up to date with payments, do not wish to borrow more (except for fees), and are switching to a more affordable mortgage on their current property. Eligible consumers must meet specific criteria, including that the new mortgage has a lower total expected cost, a lower interest rate, and a lower typical monthly payment than the current mortgage over the deal period or whole term. Inactive lenders and administrators of unregulated entities must develop and implement a communication strategy to contact relevant consumers about these changes. The rules come into force immediately, and lenders using the modified assessment must report these sales via Product Sales Data.