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Rules that limit British mortgage loans will be alleviated in plans that the financial regulator has announced on Friday to make it easier for people to buy their own home.
AND Financial behavior authority He said that it was close to launching a call for evidence of how to release the rules that require banks to test if the borrowers could cope with higher interest rates.
The regulator also wrote plans for launching “public debate” in the mortgage market in June and launching consultation in May to present “early ideas” on how to ease the renovation, get advice and reduce loan deadline in the home.
The proposals, which will take place in the rules intended to prevent the future financial crisis, are part of The answer fca The call of Prime Minister Sir Keira Starmer to focus on regulators on growth measures.
FCA’s mortgage proposals were greeted by chancellor Rachel Reeveswho said that “the economic growth and help workers’ families will begin to enter the residential ladder.”
Guardian Director Nikhil Rathi said: “We are taking fast actions to support people in getting keys in their own home.” He added that the regulator wants lenders to use flexibility in their existing rules of stress testing “to help larger people become homeowners.”
However, some officials take care of the rejection of many rules introduced after the 2008 financial crisis. In order to prevent excessive risk of risk in the mortgage market could expose taxpayers to the risk of having to re -throw large banks.
Governor Bank of England Andrew Bailey He told the MPs In January that any reforms on mortgages should be taken into account by helping to avoid the “real problem we have seen in the past” in the next cyclical fall or economic shock.
Rathi also said that the mitigation of mortgage loans control could increase the default values and return of homes, urging politicians to define an acceptable level of damage to consumers because he warned that more “would go wrong” when the regulations are hidden.
Mortgage loan in the UK is controlled by a mix of rules from FCA and Boe, most of which were introduced after the financial crisis.
FCA requires banks to perform accessibility tests to check that the borrowers can continue to resume if interest rates are increasing.
The guard said many lenders used a higher interest rate in the stress test than the rate they actually offered, which “may be an unnecessary limiting approach to otherwise affordable mortgage”, especially since interest rates fell from their recent top.
The Boe Financial Policy Committee limits banks above a certain size to borrow no more than 15 percent of mortgage in ratios greater than 4.5 times more than household revenue. He changed the threshold of borrowing this restriction in November, so he was applied to fewer banks.
FCA announced that a planned public debate on the mortgage in June would consider “an appetite for risk and responsible risk takeover, alternative testing of accessibility and innovation of products, lending to later needs for life and consumer information.”
The regulator added that “it would also be advised to retire outdated regulatory guidelines, such as the maturation of mortgage guidelines only for interest,” adding that this overlapped with new rules of consumer duties that require financial institutions to ensure that they behave with customers fairly.
In a letter to the City Minister Emma Reynolds, Rathi announced on Friday that “consumer protection and responsible loans would remain fundamental principles” in any transcript of his mortgage rules, but added that “behavior and solid culture are now far stronger.”
