Homeowners could find it easier to remortgage or reduce their mortgage term
The Financial Conduct Authority (FCA) said the shake-up is part of reforms to mortgage rules to help people navigate their financial lives.
The FCA is removing guidance that has 'served its purpose' to reduce the regulatory burden on firms.
Under the changes, borrowers could find it easier to reduce their mortgage term, helping to lower the total cost of borrowing and reduce the risk of repayment extending into retirement, the regulator said.
It is removing a requirement for a full affordability assessment when reducing the term of a mortgage, but lenders are still expected to consider affordability where they choose to use the changes.
For example, firms must act to avoid causing foreseeable harm and must monitor and regularly review the outcomes customers are experiencing, the regulator said.
People should also find it easier to switch to a new lender to remortgage, if they wish to, helping them to access cheaper products.
Consumers could see their choice improved by allowing for simpler affordability assessments, where a proposed remortgage is on similar terms to an existing contract, but more affordable than a new deal indicated by a customer's existing lender.
The FCA expects many borrowers to continue to benefit from regulated mortgage advice.
Lenders are expected to consider what is appropriate to identify consumers who need advice or other support.
Emad Aladhal, director of retail banking at the FCA, said: 'We are helping more people navigate their financial lives by supporting those who can afford to buy a home and supporting competition in the mortgage market.
'Consumer needs have changed over recent years, and our rules are changing too.
'Today's changes support growth by simplifying some of our rules, saving consumers time and money, while ensuring they still benefit from advice, where needed.
'We want lenders to use these changes to innovate and better serve aspiring homeowners and existing borrowers.
'These reforms are another significant step in our mortgage rule review, which we're delivering quickly.
'They are supported by the strong protections we've already put in place for consumers in the mortgage market.'
The regulator said reform of the mortgage market is possible due to the continuation of high standards, such as the Consumer Duty, which requires lenders to put customers at the heart of what they do, as well as effective affordability checks and support for people in financial difficulty.
The FCA's policy statement said regulatory reforms introduced after the 2008 financial crisis have improved standards across the mortgage market, with overall mortgage arrears and repossessions remaining low by long-term standards.
The regulator said that, while changes are voluntary for firms, supporting sustainable home ownership and a competitive mortgage market is a collective responsibility.
Changes to mortgage rules were included in the FCA's letter to Prime Minister Sir Keir Starmer earlier this year, linking with the Government's aims to support economic growth.
As part of its wider mortgage rule review, the regulator has opened a public discussion on the future of the mortgage market.
It is inviting feedback until September 19 2025.
Many lenders have recently made changes enabling some people to potentially borrow more, following clarification from the regulator.
Paul Matthews, senior director of risk at leading financial services consultancy Broadstone, said: 'The FCA is taking significant steps to make it easier for consumers to make changes to their mortgages and get better support on their available options.
'The easing of regulation will allow lenders greater flexibility to innovate in the market.'
Charles Roe, director of mortgages at UK Finance, said: 'The FCA's reforms are a welcome step to help lenders respond more effectively to customer needs and widen access to homeownership.
'Their optional nature means that firms can apply them in line with their own risk appetites. By reducing regulatory friction and enhancing switching flexibility, the reforms will enable the mortgage sector to continue to support the Government's growth agenda, by supporting both new and existing mortgage customers.'
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
18 minutes ago
- Yahoo
Trump Says U.S. Has ‘50-50 Chance' of Reaching Trade Deal With EU
President Trump arrived in Scotland to meet the U.K. and the European Union leaders, saying the U.S. has a 'good, 50-50 chance' to strike a trade deal with the EU. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
41 minutes ago
- Yahoo
BT slows exodus of broadband customers as alt-net rivals struggle
BT has stemmed an exodus of broadband customers in a sign that the former monopoly is holding its ground against struggling rivals. Openreach, BT's network division, lost a further 169,000 customers over the three months to July, which it blamed on competition with rivals and a weaker overall market. However, the figure was an improvement on the previous quarter, when a record number – almost a quarter of a million customers – left BT's network, and significantly below analyst expectations. Bosses previously said they expected losses to continue at the same rate over the coming year. Shares in BT jumped as much as 10pc to their highest level in six years. Openreach's customer base has dropped by more than 800,000 over the past year as smaller rivals known as 'alt-nets' try to lure consumers to their full-fibre networks with cut-price deals. The telecoms giant has also been hit by troubles at TalkTalk, which lost 100,000 subscribers a quarter last year. TalkTalk used the Openreach network, meaning the decline has passed through to BT. BT has reportedly threatened to block TalkTalk from putting more customers on its network, while executives have held early-stage discussions about a potential rescue deal for the struggling firm. But the latest figures suggest the Openreach customer base is beginning to stabilise amid heavy investment in the network. BT's network has expanded by 1m homes for the past six consecutive quarters at an average build rate of 81,000 a week. The company has been boosted by a deal signed last month with city-focused broadband provider Hyperoptic, which it said will bring roughly 1m additional homes to the Openreach network. Meanwhile, rising build costs and huge debt burdens have fuelled speculation of a wave of failures among alt-nets. CityFibre this month secured a crucial £2.3bn lifeline from shareholders and lenders after warning that it was on track to run out of money by the middle of the year. The improved performance will come as a fillip to Allison Kirkby, who took over as chief executive of BT at the beginning of last year. The telecoms boss has set out a turnaround plan aimed at simplifying BT, and refocusing the company on its core offering of mobile and broadband services. EE, the group's mobile brand, is under increased pressure after losing its crown as Britain's largest network following the £15bn merger between Vodafone and Three. However, Ms Kirkby has so far pleased investors by pledging to increase returns as she cuts £3bn in costs and scales back hefty network investments. BT also confirmed that it had poached chief financial officer Patricia Cobian from its largest rival Virgin Media O2. Ms Cobian, whose appointment was first reported by The Telegraph, will replace Simon Lowth and become the company's first female finance chief. Ms Kirkby said: 'I am thrilled that Patricia is going to be joining BT next year. Her leadership, deep industry experience and knowledge will be invaluable, as we continue our once-in-a-generation upgrade of the UK's digital infrastructure and accelerate BT's modernisation. 'As he prepares for retirement, I'd like to thank Simon for his outstanding contribution to BT over so many years – and on a more personal note, for his wise counsel. 'His leadership has played a major part in our strategy and transformation to date, as we become a better BT for our customers, our colleagues, the country and our owners.' Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
an hour ago
- Yahoo
Get your act together on immigration, Trump tells Europe as he lands in Scotland
Europe 'better get your act together' on immigration, US President Donald Trump said as he landed in Scotland. Mr Trump is in the country for a four-day visit to both of his golf clubs in Aberdeen and Ayrshire. Landing at around 8.30pm on Friday, the president was greeted by Scottish Secretary Ian Murray before speaking to reporters. Asked about illegal immigration – which successive UK governments have sought to curb – Mr Trump said: 'On immigration, you better get your act together. 'You're not going to have Europe anymore, you've got to get your act together. 'As you know, last month we had nobody entering our country – nobody, (we) shut it down.' He added: 'You've got to stop this horrible invasion that's happening to Europe.' Immigration, Mr Trump said, was 'killing Europe'. Some European leaders, he continued, 'have not let it happen' and are 'not getting the proper credit they should', though the president did not say who he was talking about. Mr Trump said: 'Many countries in Europe, some people, some leaders, have not let it happen, and they're not getting the proper credit they should.' The president also praised Sir Keir Starmer ahead of a meeting between the two at one of his courses in the coming days, describing him as a 'good man'. 'I like your Prime Minister, he's slightly more liberal than I am – as you probably heard – but he's a good man. He got a trade deal done,' he said. 'You know, they've been working on this deal for 12 years, he got it done – that's a good deal, it's a good deal for the UK.' The president's motorcade – which contained more than two dozen vehicles – passed a small group of protesters as he entered his Turnberry golf club. Mr Trump also suggested he would be meeting Sir Keir 'tomorrow evening', although it is understood the pair will not meet until Monday. As well as the Prime Minister, Scottish First Minister John Swinney will meet with the president, as will European Commission president Ursula von der Leyen, who confirmed on X she will come to Scotland on Sunday in a bid to hash out a trade deal between the US and Europe. Mr Trump told journalists there was a 'good 50/50 chance' of a deal being struck, adding that it would be the 'biggest deal of them all'. The president and Sir Keir are expected to discuss potential changes to the UK-US trade deal which came into force last month. Mr Swinney has pledged to 'essentially speak out for Scotland'. Speaking as he boarded Air Force One in the US, Mr Trump said he would be having dinner with the Prime Minister at Turnberry, before 'going to the oil capital of Europe, which is Aberdeen'. He said: 'We're going to have a good time. I think the Prime Minister and I get along very well.' Mr Trump added: 'We're going to be talking about the trade deal that we made and maybe even approve it.' He also told journalists he was 'looking forward' to meeting with the 'Scottish leader' Mr Swinney, describing him as a 'good man'. During his time in Scotland, the president is also likely to spark a number of protests, with concerns being raised about how such demonstrations are policed. Police Scotland has called in support from other forces in the UK to help bolster officer numbers, though senior officers and the organisation which represents the rank-and-file have accepted Mr Trump's visit will have an impact.
