Homeowners will soon be coming to the realization that things are changing in the mortgage lending market.  There are many that will discover that once their mortgage deal ends and they go to remortgage there will be many changes.  The new advisory rulings by the Financial Services Authority (FSA) will be making a major impact on the lending market and homeowners will be fully impacted.

The Financial Services Consumer Panel warned that there needs to be protection in place to help vulnerable homeowners that will be chained to their current mortgage and without the ability to remortgage.  These homeowners could be vulnerable to unfair treatment and need a source of protection to keep them safe.

With interest only mortgages to be less available due to the new rulings and tighter lending criteria those homeowners with interest only mortgages will find themselves without the ability to remortgage to another interest only deal.  With income verification necessary on all mortgage lending it means that many self-employed homeowners will be impacted by the changes.  Since many have been pushed to creating a job through entrepreneurship rather than finding a job due to unemployment it will be shock for many to find they will have difficulty or rejection when trying to remortgage.  Income verification is often a tricky process for a self-employed homeowner.

The Financial Services Consumer Panel which advises the FSA says more needs to be in place to help homeowners.  It said, “"The risk of being charged a higher interest rate because a consumer is unable to move their mortgage elsewhere is particularly acute.

“This applies both to borrowers who are already trapped, because they do not meet current tightened lending criteria, and those who may be trapped in the future following implementation of the MMR.

“We suggest a specific rule to ensure that consumers impacted by the transitional arrangements are not unfairly treated or discriminated against by reason of their inability to access alternative, more competitive mortgage products.”