Long-standing mortgage borrowers who are not able to switch to a better deal, as a “mortgage prisoners”, should help the UK’s financial services authority has said.
The Financial Conduct Authority (FCA) also wants to find that it is easier for people to the best mortgage, about 30% to the cheapest deal.
However, he said, the competition on the market worked well for many people.
The FCA comments came in an interim report in the mortgage market.
Christopher Woolard, Director of strategy and competition at the FCA, says: “For many, the market is working well and with a high degree of involvement of the consumer.
“We believe, however, that things could work better with more innovative tools to help consumers.
“There are also a number of long-term borrowers, the up-to-date are not constantly with their mortgage repayments but able to deal with a new mortgage; we want to explore ways that we can and the industry, help you.”
Some mortgage holders is trapped, and found themselves in their current deal, when tighter affordability checks for mortgage applications were brought during 2014.
These “mortgage prisoners” were not in the position to move to a better deal, if your existing mortgage is switched back to the more expensive standard variable rate, you could even meet if you the payments.
The FCA said that it intends to explore ways to help these customers,” to approve, for example, a cross-industry agreement, applications for a new mortgage offer from the existing customers whose most recent mortgage was recorded before the financial crisis and are up-to-date with the payments”.