UK Finance Annual Mortgage Dinner and The New Mortgage Charter

An exhilarating evening was held with the members of the mortgage industry on 12 December with people dressed in black tie. The mood was set by the Director of Mortgages for UK Finance and further extended by the chair of akt Charity by providing safe homes for UK LGBTQ young people. Positivity for 2024 was palpable.

The Director opened with giving wholehearted support for the new Mortgage Charter.  The key is to vivify the mortgager during these difficult financial times as the fixed interest mortgage becomes variable. The rise in monthly mortgage expense is astronomical often a tripling (x3) of the existing amount. 

The step change is to keep their customers feeling safe and secure while the mortgage industry adapts to the new fiscal reality.

Industry has proactively contacted millions of customers to offer additional support. Further steps to be taken to support the market’s 11 million mortgages: £1.7 billion. (https://www.gov.uk/government/publications/mortgage-charter/mortgage-charter)

The feedback on the charter was excellent and the industry would welcome:

Artificial Intelligence (AI) – to give market insight and pricing suggestions

Robotic processing – automate tasks and monitor compliance to the charter

Greater cost efficiencies – remove the manual activities and speed up the process

Application Programming Interface (API) – to push/pull internal/external data

Real Time pricing at customer contact to give the the latest financial information

What was fascinating, given the scale of change to the industry, there was clear acceptance and support needed to make the Charter happen as fast as possible. 

Now is time for lenders to:

Provide well-timed information to help customers plan ahead 

Offer tailored support and extending terms to reduce payments

Give a year of clemency so customers are not forced out of their homes

Allow customers to change without new affordability checks or credit scores

Enact promptly the activities between lenders, FCA and Government permitting customers, who are up to date with their payments, to:

• Switch to interest-only payments for six months or
• Extend their mortgage term to reduce their monthly payments 
• This is particularly true in supporting those mortgage owners coming off fixed to variable rates. Currently there is little choice.

The Director further highlighted the need to support the UK Government and, in turn, be in sync and influence the world’s regulators. The Government and FCA confirmed it has delivered:

Action for Mortgage Interest support to be easier to access; if on Universal Credit receive help with mortgage interest payments after three months

Record levels of funding for the Money and Pensions Service to provide debt advice in England

New guidance clarifying how lenders can support borrowers impacted by the rising cost of living

Information for borrowers on the options and support available if they are struggling with payment

Like the Holiday Season, the response by the 300 people at the dinner was charismatic. There seemed to be a new energy that would bring the Charter to bear and at the same time embrace digitalisation of the mortgage industry. It was a wonderful Christmas event.