Mortgage rates are controlled in the UK

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This capping of variable rates legislation has been in existance in the English legislature since the late 1990's, we usually copy English Law as our legal system is based on the common law of Oliver Cromwell, but not in this case. Funny that!
 
Both the O.F.T and the F.S.A either sanction the lender or bring them to court regarding the increased variable mortgage rate as being an unfair term. In fact, this year this type of term is being added to the grey list of unfair terms in contract legislation. (UFICCR 1999 refers)
 
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advice said:
This capping of variable rates legislation has been in existance in the English legislature since the late 1990's, we usually copy English Law as our legal system is based on the common law of Oliver Cromwell, but not in this case. Funny that!
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I wasn't aware of that - could you provide a link to the relevant English legislation?
 
Hi advice

I have moved this issue from two separate threads to tease it out further.

Please provide more information.

What is the maximum rate charged on home loans in the UK?

I had not heard of the OFT of "F.S.A" sanctioning any lenders. Can you provide details of any cases?
 
I think he already has; UFICCR 1999 refers. I went on line and saw a lot of mortgage providers been halled before the courts for charging svr rates that the FCA thought were to high. Sarenco go on line and see for yourself.

see BOI reverse mortgage hike for 1200 customers
see santander to write to 270,000 customers over unclear mortgage hikes,
 
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Piggybank said:
I think he already has; UFICCR 1999 refers. I went on line and saw a lot of mortgage providers been halled before the courts for charging svr rates that the FCA thought were to high. Sarenco go on line and see for yourself.
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Fair enough - I don't think the above posts are in chronological order but I'll certainly have a dig now that I have a reference.
 
Piggybank said:
BOI reverse mortgage hike for 1200 customers
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That has nothing to do with the issue as far as I can see.

Those who will get the reprieve include 1,000 flexible mortgage customers who were actively using the flexible facilities on their mortgage account and had received a specific letter that might have caused them to believe the rate differential they were paying was set for the term of their loan.


Around 200 people who switched to a tracker mortgage will also escape the increase. They received documentation detailing that the differential on their mortgage was variable, but the conditions they were sent did not detail the circumstances under which it could be changed.

Can someone provide a direct link and maybe even an extract from a regulation which says that mortgage rates are controlled in the UK.

Ross Maguire argues that the Unfair Terms in Consumer Contracts would give an Irish borrower a case for challenging interest rates. What I am looking for is something more specific. The FCA imposing a limit of 5% on mortgage rates.
 
Hang on - I've just realised what UFICCR stands for! We actually have the same legislation in Ireland - it transposes an EU Directive - and it certainly doesn't place a cap on variable mortgage rates.

I have also searched on line and can find no references to any UK cases where Unfair Terms in Consumer Contracts regulations were used to challenge the terms of any variable rate changes. If anybody can point to something specific, it would be much appreciated.
 
To Sarenco, my doubting Thomas,

Without having to spoon feed you, you don't appear to know where to trawl the net in order to investigate matters. I will help you this once. Look up FCA sanctions against Cheshire Mortgage Corporation Limited. Sarenco, in this Country there has been no case taken by a individual against a Bank regarding unfair terms in mortgage contracts that has been allowed to get to Judgment. (if you get my drift ) All I can say is, if anyone challenges their respective mortgage agreement in relation to article 5 of SI 27/1995 Unfair Terms in Contract Regulations 1995 (ie that the terms are drafted in plain, intelligible language.) watch what happens !
 
There is already a ruling from the European Court of justice about rates, penalties and general repossession Google ECJ Mohamed Aziz
 
advice said:
To Sarenco, my doubting Thomas,

Without having to spoon feed you, you don't appear to know where to trawl the net in order to investigate matters. I will help you this once. Look up FCA sanctions against Cheshire Mortgage Corporation Limited. Sarenco, in this Country there has been no case taken by a individual against a Bank regarding unfair terms in mortgage contracts that has been allowed to get to Judgment. (if you get my drift ) All I can say is, if anyone challenges their respective mortgage agreement in relation to article 5 of SI 27/1995 Unfair Terms in Contract Regulations 1995 (ie that the terms are drafted in plain, intelligible language.) watch what happens !
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Well, first off you claimed that the UK had introduced legislation in the 1990s to cap variable mortgage rates but you were not able to back up this claim.

Is this the Cheshire Mortgage Corporation case that you are referring to?
http://www.theguardian.com/money/2012/dec/10/fsa-fines-cheshire-mortgage-corporation

Assuming it is, this case appears to relate to an inconsistent and unfair application of arrears charges and, on the face of it, does not have anything to do with increasing variable mortgage rates as claimed. You will forgive me if I am starting to doubt your credibility at this stage.

And no, I don't get your drift - what are you talking about?
 
Sarenco said:
Well, first off you claimed that the UK had introduced legislation in the 1990s to cap variable mortgage rates but you were not able to back up this claim.

Is this the Cheshire Mortgage Corporation case that you are referring to?
http://www.theguardian.com/money/2012/dec/10/fsa-fines-cheshire-mortgage-corporation

Assuming it is, this case appears to relate to an inconsistent and unfair application of arrears charges and, on the face of it, does not have anything to do with increasing variable mortgage rates as claimed. You will forgive me if I am starting to doubt your credibility at this stage.

And no, I don't get your drift - what are you talking about?
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It's actually far reaching finding, however the only reference to "affordability", relates to the underwriting process and failure by CMCL to conduct adequate due diligence on their Borrowers income & expenditures.

CMCL are a small operator who specialize in lending to people with County Judgements against them (almost the definition of sub-prime).
Link to the actual FCA report here http://www.fca.org.uk/static/pubs/final/cmc-ltd.pdf
 
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Andy836 said:
It's actually far reaching finding, however the only reference to "affordability", relates to the underwriting process and failure by CMCL to conduct adequate due diligence on their Borrowers income & expenditures.

CMCL are a small operator who specialize in lending to people with County Judgements against them (almost the definition of sub-prime).
Link to the actual FCA report here http://www.fca.org.uk/static/pubs/final/cmc-ltd.pdf
Click to expand...

Thanks for the link to the FCA report. It's certainly an interesting case and I can see that it could be of broader application.

However, it has nothing whatsoever to do with the setting of variable rates as implied by the OP.
 
advice said:
This capping of variable rates legislation has been in existance in the English legislature since the late 1990's
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Hi advice

This issue affects 300,000 Irish people. If what you say is true, it could be a great help.

We are not interested in your drift, or in vague unrelated cases.

Please provide a direct link to the legislation which was introduced in the 1990s to control interest rates.

Brendan
 
I cannot find any mention of any upper limit on this SVR cap margin.
Nothing on the Financial Conduct Authority (formerly FSA) website that I can see.

http://www.fca.org.uk

If there was such a limit then I would expect the regulator to mention it?
 
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Folks

Advice has claimed that there is legislation to control interest rates. Please do not take the thread off topic. Let him or someone else answer this important question.

Reporting that a particular bank offers a tracker mortgage and has been fined by the FCA for not making it clear that the terms have changed is simply off topic. That is the same in Ireland. An Irish bank can offer a tracker rate.

There is a simple question to be answered here. If the contract allows, can a UK mortgage lender charge what it likes or does legislation cap it?
 
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