Did you take out a mortgage to buy your home before 2014 and are now finding it hard to switch to a better deal, even if you’re up to date with your payments? Then this might be because of new affordability rules introduced by the FCA.
Affordability tests, or assessments, look at your income and expenses to determine if you can afford the mortgage repayments.
Since 2014, these have been made much stricter. This means that while you might have passed the affordability test when you first got the mortgage, you might not now.
In October 2019, the Financial Conduct Authority (FCA), introduced changes to the rules which might help you switch to a more affordable mortgage deal. These new rules are based on your mortgage payment history, rather than the affordability assessment.
Many mortgage firms have been required to write to customers who are unable to switch and might benefit from these changes. If you have received a letter, it doesn’t mean you’re automatically eligible for these changes.