{"id":19647,"date":"2018-08-02T09:45:10","date_gmt":"2018-08-02T08:45:10","guid":{"rendered":"https:\/\/www.buyassociation.co.uk\/?p=19647"},"modified":"2018-08-02T09:45:10","modified_gmt":"2018-08-02T08:45:10","slug":"10000-mortgage-prisoners-to-be-offered-cheaper-mortgage-deals","status":"publish","type":"post","link":"https:\/\/www.buyassociationgroup.com\/en-gb\/news\/10000-mortgage-prisoners-to-be-offered-cheaper-mortgage-deals\/","title":{"rendered":"10,000 \u2018mortgage prisoners\u2019 to be offered cheaper mortgage deals"},"content":{"rendered":"

Mortgage lenders have committed to helping thousands of UK homeowners currently trapped in expensive mortgage deals taken out before the financial crisis.<\/strong><\/p>\n

Termed “mortgage prisoners”, they have had no possibility of switching mortgage deal to take advantage of lower rates<\/a> over the past 10 years.<\/p>\n

Despite making regular mortgage payments<\/a> without default, stricter affordability<\/a> tests meant that the wealth of these borrowers was no longer enough to qualify them for a mortgage. As a result, up to 150,000 homeowners found themselves unable to move to a better deal<\/a> when their existing mortgage term finished and automatically switched to their lender’s more expensive standard variable rate<\/a>.<\/p>\n

According to the Financial Conduct Authority (FCA), 120,000 homeowners had mortgages held by non-regulated firms, and 30,000 with authorised mortgage lenders. Of the 30,000 borrowers with authorised lenders, about 10,000 are with lenders still actively operating in the mortgage market.<\/p>\n

10,000 homeowners to be offered lower rate deals<\/h4>\n

It is to these 10,000 homeowners that 59 lenders, under the organisation of trade body UK Finance, have made a voluntary commitment to help find better mortgage deals. While rules set by the regulator mean that these borrowers remain blocked from searching the whole market<\/a> for a better deal, they will receive a letter from their existing lender with details of lower rate mortgage deals available to them.<\/p>\n

Lenders that have committed to the agreed common standards to help borrowers include Santander, Barclays, Natwest, Nationwide, Lloyds, RBS, Skipton and a range of building societies, in all representing 93% of the UK mortgage market. A number of these lenders already offer existing customers in this situation the opportunity to switch mortgage deals<\/a>, but all have agreed to write to every qualifying borrower by the end of 2018 if they have not already done so.<\/p>\n

Lenders will be contacting customers who:<\/p>\n