Tens of thousands of mortgage prisoners could be freed as FCA looks to relax lending rules

potatoefeet66

Relax lending rules to secure outstanding balance or less I presume.
However, take a look at this scenario. Existing customer switched from SVR to lifetime tracker 0.84% + base lender adds one months arear to new loan putting customer in overpayment by £27.50 then without disclosing on 16 October switched customer back into deficit, customer in December was allowed to make full application to port and reduce 142k mortgage by £70k. Lender refuses forcing customer to sit on mortgage debt and effectively making him prisoner not to his preferential rate but loan outstanding.
This new FCA rule will not release this customer forced upon him by unethical and unfair treatment by lender. Life lesson 1 honesty something they refuse to comply but rather issue threats to customer of 90 day repayment of loan if he pursues resolutions.

Thrugelmir

boatman wrote: »

Change of circumstances is the most probable reason, be it kids, health, redundancy..

Unlikely. These mortgages are the legacy of lax lending criteria of the past. Coupled with the fact that are on an interest only basis not repayment. Resulting in not much equity in the property.

Thrugelmir

potatoefeet66 wrote: »

Relax lending rules to secure outstanding balance or less I presume.
However, take a look at this scenario. Existing customer switched from SVR to lifetime tracker 0.84% + base lender adds one months arear to new loan putting customer in overpayment by £27.50 then without disclosing on 16 October switched customer back into deficit, customer in December was allowed to make full application to port and reduce 142k mortgage by £70k. Lender refuses forcing customer to sit on mortgage debt and effectively making him prisoner not to his preferential rate but loan outstanding.
This new FCA rule will not release this customer forced upon him by unethical and unfair treatment by lender. Life lesson 1 honesty something they refuse to comply but rather issue threats to customer of 90 day repayment of loan if he pursues resolutions.

Every case will be addressed on it's own merits. Mortgage prisoners have no options. As the finance house they are currently with has no ability to underwrite new business. They are totally trapped on a relative high SVR.

potatoefeet66

Each case should be considered on its merits I agree. However, setting a president increasing lending upon rate switching, then reversing this without disclosing preventing an informed decision by customer and declining an application because of arear for simultaneous reduction upon porting having considered the merits or internal policy rules just forces customer to sit on debt. With an existing Ltv less than 40% and no alternative market product better or equal still results in prisoners. Just not due to preferential rate lender is inclined not to agree amendments to existing contact as no longer of commercial benefit to them. I think that’s a conflict of interest and not fair. Lots of customers were treated this way ‘Life lesson’1 honesty.

bobby1999

Having become a prisoner of Landmark mortgage company do we now have redress against the government for causing this ?

potatoefeet66

It’s clear that those caught in this trap would happily accept a minor change mutually beneficial changes to their contracts even in their current rate if required. But to be forced to sit on mortgage debt making prisoners of the lenders for whatever reason due to the ever changing internal policy rules makes a mockery of regulators. Nevertheless, when ian existing borrower meets internal policy rules without interference by lender and is given an application advised or non advised with purpose to reducing lending is positive, but this has not been the case when lender have faced porting existing lending which benefits their customer. If anyone’s tried to port simultaneously making a lump sum reduction to a preferential ( to customer) rate and finds they now no longer meet criteria this is tree that needs barking up. MSE has honourably fought mortgage prisoners corner but I’m sure everyone would have agreed a mutually beneficial amendment.

bobby1999

Landmark do not appear to come under FCA RULES ?

Thrugelmir

bobby1999 wrote: »

Landmark do not appear to come under FCA RULES ?

Landmark does not underwrite new business. It's not regulated to. In effect it's running off the mortgage book it acquired.

Thrugelmir

potatoefeet66 wrote: »

Each case should be considered on its merits I agree. However, setting a president increasing lending upon rate switching, then reversing this without disclosing preventing an informed decision by customer and declining an application because of arear for simultaneous reduction upon porting having considered the merits or internal policy rules just forces customer to sit on debt. With an existing Ltv less than 40% and no alternative market product better or equal still results in prisoners. Just not due to preferential rate lender is inclined not to agree amendments to existing contact as no longer of commercial benefit to them. I think that’s a conflict of interest and not fair. Lots of customers were treated this way ‘Life lesson’1 honesty.

You are giving your side of the story. No doubt your lender has a different tale to tell. This news story doesn't change anything. As ultimately each lender will still run it's business in accordance with a defined internal policy. Lenders operate at a macro rather than a micro level.

Pamela_m

I’m with what was northern rock. And I would like to know which mortgage lenders will be prepared to do this