People who have become “mortgage prisoners” because of tough lending rules could soon be freed.

Under strict rules introduced to ensure people could afford mortgage repayments, which came in after the financial crisis, some people have been stuck with an existing expensive mortgage. They were unable to switch to a better deal because of the tighter lending rules.

Now, the Financial Conduct Authority (FCA) is to change how lenders assess whether a borrower can afford to pay back the loan.

That’s great news for thousands of people who are perfectly able to afford their mortgage repayments and want to switch to the great deals that are currently on the market.

The FCA says there are around 30,000 mortgage prisoners in the UK. A further 120,000 have mortgages with lenders that are not authorised by the FCA. All will have taken out loans before mortgage interest rates fell but are unable to switch because of the tighter rules, introduced in 2014.

The FCA is also keen to ensure that other people with mortgages switch to cheaper deals when their fixed-term deals come to an end. It estimates that around 800,000 people don’t switch quickly enough, which ends up costing them on average £1,000 a year.

Are you a mortgage prisoner? Or is your mortgage coming to the end of a fixed-term deal? If so, there’s no time like the present to look at what you might do next.

For a free, no obligation discussion on any mortgage or insurance-related issue, please give me a call on 01723 384558 or 07767 692 653 or email me at mgrayshan@googlemail.com