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Press comment: Treasury issues three line whip on mortgage lenders

28 January 2020

If you’re covering the letter from John Glen, Economic Secretary to the Treasury, to Stephen Jones, Chief Executive Officer of UK Finance on mortgage prisoners please see the following comment from Gemma Harle, managing director of Quilter’s mortgage network:

"The door to many lenders has been closed for many of those who took out a mortgage when the criteria was more straightforward. And the consequences can be substantial.

"The letter from John Glen today is a sign that the Treasury has issued a three line whip to the lending community to offer mortgages to mortgage prisoners. The Financial Conduct Authority introduced new rules around mortgage affordability to help tens of thousands of these customers but this still requires the lenders to actually participate.

"This also applies pressure on intermediaries to offer advice to these customers, an element which is crucial. Under the FCA rules a customer is deemed as affordable if the new monthly payment is less than they are currently paying. However, when an adviser first speaks to a customer and confirms income and outgoings as part of the fact find it may look unaffordable and so it is up to the adviser to work with the client and the lender to ensure the client is getting the best mortgage possible."

Kathleen Gallagher

External Communications Manager

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