Mortgage prisoners' dilemma
The ‘mortgage prisoners’ fiasco has made it easier for MPs to demonise useful financial tools. While thousands of mortgagors cheer at the news they are about to be freed from their loans, the Financial Conduct Authority's (FCA) support has come in too late to undo the reputational damage done to useful parts of the capital markets.
The FCA has made plans to free borrowers who took out high loan-to-value (LTV) and interest-only mortgages from Northern Rock and other legacy lenders, only to them find themselves stuck paying high costs after 2016 regulations prevented them from refinancing.Whichever position the government takes ...
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