Mortgages: Competition
The question
To ask the Chancellor of the Exchequer, what recent estimate her Department has made of the number of homeowners who are unable to switch to a cheaper mortgage due to changes in the (a) lending regulations and (b) policies of their current lender.
Answered by Emma Reynolds
According to the Financial Conduct Authority (FCA), the vast majority of borrowers switch within 6 months of the end of an introductory deal. However, the Government understands the challenges facing mortgage borrowers that struggle to switch to new loans. These borrowers are predominantly with closed book mortgage providers. Correspondence from the FCA to the Treasury Select Committee has shown that the number of borrowers with closed book mortgage providers have consistently declined since 2021.
There are significant measures in place to protect vulnerable mortgage borrowers across the mortgage market. FCA rules require lenders to engage individually with their customers who are struggling or who are worried about their payments in order to provide tailored support. Closed book lenders must also comply with the FCA’s Consumer Duty, which ensures firms prioritise fair treatment and good outcomes for their customers.
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