U.K. Treasury to Tighten Mortgage Rules to Protect Consumers
Treasury Minister Mark Hoban said he will tighten rules governing Britain’s mortgage market to provide greater protection for consumers.
The Financial Services Authority will be handed powers to regulate second loans on properties so it polices the entire residential mortgage market, Hoban said. Tighter rules will protect consumers when a lenders’ mortgage book is sold to an unregulated provider, he said.
“This package of measures will enhance protection for consumers in the mortgage market,” Hoban said in a statement released by the Treasury in London today.
The government aims to make the rule changes law later in 2011 although the regulator will begin implementing the changes immediately, the Treasury said.
Hoban also announced a plan to extend rules that protect consumers in sale-and-rent-back programs to the entire mortgage market. The program allows individuals selling their homes -- usually at a discount -- to remain in that property using a shorthold tenancy.
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