From Yahoo Finance: 2025-05-07 08:47:00

The Financial Conduct Authority (FCA) has launched a consultation to simplify UK mortgage rules, aiming to make adjustments easier, faster, and more cost-effective for consumers. The proposed changes are part of a strategy to help consumers navigate financial circumstances and support economic growth, providing more flexibility and choice while maintaining access to advice.

The consultation focuses on giving borrowers quicker and easier access to explore mortgage options, including simplifying the process for reducing mortgage terms to potentially lower total borrowing costs. The measures also aim to facilitate access to cheaper products when remortgaging, supporting consumer flexibility and choice in the market.

Over the past decade, the FCA has worked to raise conduct standards and improve culture among mortgage lenders. With the introduction of the Consumer Duty, the regulator aims to set clearer expectations for firms, eliminate outdated guidance, and create space for innovation in the mortgage market.

A broader public discussion on the future of the mortgage market is expected in June, covering issues such as risk appetite, affordability testing, lending into later life, and consumer information needs. FCA retail banking director Emad Aladhal emphasized the goal of deepening trust, rebalancing risk, and supporting growth and improving lives through the Consumer Duty.

Last month, the FCA began seeking feedback from firms on its upcoming live AI testing service, set to launch in September 2025, to help businesses implement AI responsibly. The consultation aims to simplify mortgage rules, making adjustments more accessible and cost-effective for consumers while supporting economic growth and innovation in the market.

Read more: UK’s FCA opens consultation to simplify mortgage rules