Nearly nine out of 10 brokers believe there is still a mortgage prisoner issue and one in four think the problem is getting worse, research from the Association of Mortgage Intermediaries reveals.
AMI, in conjunction with NMG Consulting, asked brokers about the extent to which clients felt they were trapped by their existing mortgage deal and 86% reported it as an issue.
The FCA indicated in its May 2016 post-MMR Responsible Lending Thematic Review that from its work with lenders, that there was no obvious issue.
However the research undertaken by AMI and NMG in July suggests the contrary.
Robert Sinclair (pictured), chief executive of AMI, said: “Despite the assurances from lenders, lender trade bodies and our regulator, we continue to hear evidence from our firms of a continuing problem.
“Whilst interest rates remain low, the issue is unlikely to surface significantly. However as soon as rates rise we have no doubt that what is a trickling stream will become a flood and the industry will have to address matters.
“This covers a range of issues including weak loan to value, prior self-certification, interest only, self-employed and those with credit blips but a good mortgage payment record. We hope that the supervision teams at FCA begin to take this seriously and look properly at the extent of this issue and whether all lenders are acting in the best interest of all their mortgage customers.”