Interest only mortgage deals – Deal Direct can help you switch.
A meeting to discuss interest only mortgage deals has been arranged between the Association of Mortgage Intermediaries and the Financial Service Authority.
The aim of the meeting is for the AMI to voice their concern over lenders perhaps reviewing their interest only mortgage rules to the disadvantage of many mortgage holders.
AMI director Robert Sinclair says that he is concerned that lenders changes to interest only mortgage criteria could trap some mortgage holders.
In a consultation paper by the MMR published last December, the FSA proposed unless potential interest only mortgage holders have a realistic way for repaying the mortgage, UK lenders should assess interest only mortgage affordability on a capital and interest basis
Mr Sinclair advises that the AMI plans to talk to the FSA about lenders implementing the proposals prior to them becoming actual rules. He added that the AMI wants to make sure that there are no current interest only mortgage holders who find themselves unable to remortgage and switch deals.
Interest only mortgages do have a legitimate role in providing mortgages for self employed borrowers, they can even be legitimately applied in distress cases.
Prior to a court granting a repossession order, an enquiry will be made as to whether a distressed mortgage holder can be moved on to an interest only deal. Are lenders now going to refuse in these cases?
The FSA has confirmed that interest only is appropriate for some mortgage borrowers and has no plans to ban it, therefore have lenders taken their tightened criteria to the extreme?
For those of you who hold interest only mortgage products whose repayment vehicle is not sufficient to repay the capital, you may want to consider switching deals.
Deal Direct can source you a repayment mortgage from the whole of the UK mortgage market, and because we are up to date on lenders criteria changes and latest rates, we are well placed to find you the most competitive deal on offer today.
