It reported that there is no easy way for a consumer to be confident, at an early stage, that they will qualify for a mortgage product, and that this is a major impediment to shopping around. As an independent mortgage broker with access to whole of market, NM Finance is able to support customers in surveying the full range of options and finding the most suitable property finance solution for their needs.
Along with a lack of confidence in their ability to qualify for a mortgage, many applicants opt to stay with their current lender in the misbelief that they are rewarded as a ‘loyal customer’ with preferential rates.
Similarly, misbeliefs, such as the need for three years’ certified accounts to apply for a mortgage as a self-employed business owner, are restricting applicants from moving forwards, often creating ‘mortgage prisoners’ who are tied to an unfavourable mortgage rate or term.
The FCA says that it will work with the mortgage broker sector to develop metrics to help consumers find the most suitable broker to work with and to better understand the mortgage options available to them.
Christopher Woolard, executive director of strategy and competition at the FCA, said: “There are a number of long-standing borrowers that have kept up-to-date with their mortgage repayments but are unable to get a new mortgage deal; we want to explore ways that we and the industry can help them.
“The mortgage market is one of the largest financial markets in the UK and there have been significant changes to the market since the financial crisis in order to ensure that we do not return to the poor practices of the past.”
The FCA will publish its final report in Winter 2018.