Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what steps the Government is taking to encourage greater switching and transparency in the UK mortgage market.

This question was answered on 10th April 2019
The FCA’s final report of the Mortgage Market Study found that there are high levels of consumer engagement, with over three quarters of consumers switching to a new mortgage deal within 6 months of moving onto a reversion rate.

The Government has worked closely with the FCA to consider how to remove the regulatory barriers that prevent some customers, particularly those with inactive lenders, from accessing better deals. The Government welcomes the FCA’s plans to move the affordability assessment from an absolute test to a relative one. This change removes the regulatory barrier that prevented some customers, who otherwise may have been able to switch, from accessing new mortgage products. The Government also welcomes the industry voluntary agreement covering 95% of the UK mortgage market to help ‘trapped’ customers of active lenders.

Transparency and fairness in the mortgage market is a priority for the Government. The Treasury welcomes and supports the work the FCA are doing to improve this as a result of their findings in the final report of the Mortgage Market Study. The Government will continue to monitor the market and support the FCA when necessary.