JSMedia – Lenders need to offer more support to mortgage prisoners to stop them from becoming even more vulnerable. The financial crisis has made many customers’ circumstances worse, and many are unaware of it. To prevent further harm, responsible lenders need to provide more help to mortgage prisoners. The FCA’s report focuses on poor-value mortgages. Specialist mortgage lenders can help homeowners in such situations. The regulator’s review is currently underway, but it is unlikely to affect any existing loans.
The FCA has proposed new rules to allow mortgage prisoners to change lenders easily. Lenders need to offer more assistance to mortgage prisoners in order to prevent them from becoming further in debt. Lenders need to offer more help to mortgage prisoners so they can make informed decisions. For example, they can recommend next products to their customers. In addition, they can tailor communications to suit their needs. By offering more support to these customers, lenders can avoid having to make multiple calls to their customers.
A recent study has shown that 97% of mortgage prisoners are in an interest-only mortgage, which does not build equity. This means that their new mortgage will have a high loan-to-value ratio. A government-backed equity loan could help them lower this ratio. In addition, the UK Treasury is offering interest-free government equity loans to those in such situations. And as the financial crisis continues, more lenders need to offer more support to mortgage prisoners.
Lenders Need To Offer More Help To Mortgage Prisoners
Some lenders are not required to use a modified affordability assessment when making offers to mortgage prisoners. While mortgage prisoners may have a difficult time getting back on their feet, they can use a simple strategy. Taking on overpayments of their mortgage can help them avoid paying penalties and build up equity in their property. This will increase their chances of obtaining better rates from other lenders. You should consider a repayment plan for a mortgage with more benefits than just avoiding penalty fees.
If you have a mortgage that is not affordable for you, it is likely that you are a mortgage prisoner. In this situation, a loan modification may be necessary to get a better interest rate. It’s not advisable to make the decision before consulting with a qualified financial adviser. You should try to compare lenders’ terms and conditions, and look for one that meets your requirements.
There are a number of ways that mortgage prisoners can receive the support they need. By ensuring that they have access to more information, you can make an informed decision about a mortgage. If you are a mortgage prisoner, it can be beneficial to your credit history. If you have no credit history, you may still be able to get a better deal. This can help mortgage prisoners regain control of their finances.
The FCA says that the number of mortgage prisoners has fallen steadily over the past year. Last year, 26 mortgage offers were made to mortgage prisoners over 10 months. However, the FCA report shows that the lack of engagement with lenders has led to a lack of interest in borrowers’ credit ratings. Further, the FCA report also finds that fewer borrowers are actively seeking help from brokers than they would otherwise be.
The LSE London report acknowledges that its analysis has some limitations, as it did not find reliable data on mortgage prisoners and their rates. The report also fails to provide details on how the solutions are to be implemented, which has not gone unnoticed by campaigners. The government should provide financial support to independent debt-counselling organisations, as they are the key to solving this problem. And it should fund them with a range of benefits.
Lenders need to offer more help to mortgage prisoners. Some are already close to their risk threshold and can’t afford to switch to another lender. Those who are in a mortgage prison can’t afford to wait for this to happen. The government must intervene and ensure they give more support to those who are impacted by this crisis. So far, the government’s action will make mortgage prisoners feel better about themselves.