Most people think MMR is a triple vaccination for kids. But in the home loans industry, it has another meaning.
The comprehensive Mortgage Market Review (MMR) started in 2009. A Policy Statement was released in October 2012, with reforms that will come into force in April 2014. The reforms will make the mortgage market better for consumers: ensuring that those who can afford mortgages can access them, while preventing some of the appalling practices that we saw running up to the recent financial crisis.
In essence, MMR rules will try to make everything clear and fair. If you can afford a home loan you should be able to get one, regardless of age or the nature of your income. But affordability checks will be thorough.
For example, customers will have to give evidence of income in all cases, to satisfy lenders that they can afford the repayments, even if interest rates rise. There will be no more fast track or self-certified loans, but interest-only mortgages will still be available where there is a credible repayment strategy.
You will find that interactive sales conversations – face to face and by telephone – will be advised. In fact non-advised sales will not be allowed.
There is a summary of the Mortgage Market Review on the FSA website.
Limetree welcomes the MMR reforms, not only to prevent bad practices and ensure better results for customers, but also because they will create a level playing field across all mortgage product distribution channels.
Of course Limetree are not waiting until next year – we have always been fair and clear to our customers! For truly independent, expert mortgage advice, get in touch today.
