Today’s response to the review of mortgage rules for the ultimate behaviour authorities is expected to bring radical changes to the home loan market and the role of brokers today.
The review by city regulators targets labor programs to build 1.5 million homes by the next election. It hopes people can buy these homes.
When regulators relaxed their ten-year loan rules in July to allow large lenders to earn more than 4.5 times more than 4.5 times more than new home loan loans, the prime minister made clear on the income she hoped the move would bring.
Rachel Reeves says the move will lead to 36,000 additional first-time buyers Enter the market in the first year of relaxation.
The FCA said in a June consultation that it aims to “rebalance collective risk appetite in mortgages, including trade-offs and possible risks.”
Property professionals who submitted their applications to comments said the regulatory body has a wide range.
It includes encouraging more first-time buyers, self-employed people, and variable income to enter the market.
Regulators will also consider barriers to sharing ownership and future life loans.
It will also make more broad use of rent-based affordability testing and ways to increase digital home purchases.
But the role of the agent is also in the focus.
In an consultation paper earlier in May, the FCA said it hopes to increase the use of execution-only sales to reduce borrowing costs.
Watchdog lists three scenarios whose proposed broker fees may result.
Its highest case was 7.5% of the home loan sold by an intermediary (about 97,000 mortgages), resulting in charges of £95.1 million and consumer fees dropped by £21.4 million, totaling up to £116.5 million in loss expenses.
The broker is concerned that this more comprehensive comment will lead to further changes.
Brokers say that just as few as nine out of 10 mortgages arranged through intermediaries, no regulatory simplification can dilute access to impartial professional guidance.
They added that the FCA should continue to encourage leading mortgages with recommendations so that customers can compare options and avoid foreseeable harm.
Coventry is used to provide support from the director of intermediary relations leader Jonathan Stinton.
“Whatever changes happen, brokers will remain at the heart of helping clients understand their choices. Their role in guiding people through product transfer, rebellion and all the complexities,” he said.
Stington continued that the “swing” of mortgage rules may have been swinging in regulations proposed after the 2008 financial crisis.
Michael Shand, head of management of CAPCO consulting firm, said regulators should firmly cut costs in their sight.
“In low-risk cases, simpler rules and reduced recommendation requirements can make it easier for people to buy their first home or progress through the ownership phase,” Shand said.
“Lenders also have the opportunity to use data and technology to design products that reflect modern borrowers.”
But he added: “Lenders will need to balance innovation and responsibility to ensure that if the economic situation changes, more personalized products remain robust.”
Pete Maddern, retired managing director of Canadian Living UK, said the comment “has an important conversation about how borrowing later can and should play in maintaining retirement income standards”.
“For many people who retire now and in the future, pension savings alone are not enough to meet their income needs,” he added.
Maddern points to FCA data, which shows that one-third of pension pension adults save £10,000.
“With wealth accounting for 40% of the UK family’s wealth, unlocking this resource through later loans is crucial to ensuring later financial security and quality of life,” he said.
But Stington of Coventry pointed out that solving the housing crisis in the UK depends on building more homes.
He said: “Regulatory measures are only part of the problem.
“There are risks, loosening affordability rules can exacerbate home price inflation rather than expanding opportunities for home ownership.
“The changes in affordability and product design will only go too far before addressing housing shortages.
“If we want to build a more sustainable, accessible market, any reform must be built with meaningful construction.”
The appearance of the FCA is designed to free up much of the mortgage market and acknowledges the possibility of increasing the risk of default.
However, another part of the puzzle is the sharp rise in home construction.
