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Broker enquiries/Mortgage Charter

Journalist: Anna Sagar, Mortgage Solutions / Specialist Lending Solutions

ended 30. August 2023

Interested in speaking to mortgage brokers about the Mortgage Charter and whether it has led to an increase in enquiries from customers. 

  • Have enquiries from customers grown/stayed the same or decreased since the Mortgage Charter has been brought out? 
  • Are there any measures which customers are particularly interested in? E.g. term extensions, interest-only
  • What should customers be aware of with regards to the Mortgage Charter? 

5 responses from the Newspage community

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Stephen Perkins
Managing Director at Yellow Brick Mortgages
The mortgage charter has had zero effect on the volume of mortgage enquiries, or anything else for that matter. Clients were already at remortgage looking at longer terms or interest only to reduce the impact of the jump in interest rates. The charter only gave clients more safety in having such discussions mid-deal with their current lender for 6 months without it impacting their credit rating.
The parts about allowing clients to secure a new rate earlier were not worded clearly enough, so have had no real impact, with many lenders still only offering rates 4 months in advance. We also have to see how lenders view any support clients had under the mortgage charter in the future, as whilst it may not show on the credit report as arrears, lenders may still choose not to lend to clients who have utilised the charter support. I think the Mortgage Charter was a good headline, without any substance, like most of the current government's policies.
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Mike Staton
Director at Staton Mortgages
The mortgage charter was just smoke and mirrors, introduced by the government to make it look like they were trying to help, when in fact it has done quite the opposite. In a time when increasing rates to ease inflation to get the country back on track isn't working, the government introduced a scheme to allow people to have more disposable income to continue spending and counter-act the BOEs work. Its like watching a bad Punch & Judy show
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Darryl Dhoffer
Founder at The Mortgage Geezer
The Mortgage Charter introduced has had no bearing on the enquiries we are handling. If anything we have seen enquiries drop between 25 - 30% over recent months, which is not a consequence of the mortgage charter. Fortunately, we have only had a very small percentage enquire about the mortgage charter and what it means to them, and as yet, no client has had to make use by either extending the mortgage term or for a short period changing from a repayment to an interest-only mortgage. In conversations I am having, I explain that help is there if needed, and explain the consequences of extending the debt by extending the overall term of a mortgage, or by looking at Interest Only for a maximum of 6m and the effects this will have on their capital debt not reducing, and future repayments increasing
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Elliott Benson
Owner at Sett Mortgages
I have had no enquiries from current or past clients regarding the mortgage charter, this is not to say it is not going to assist some clients however I haven't noticed anyone wanting more information on this so far.

From discussions with others in the industry it looks like switching to interest only has been the most popular though.
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Neezam Romjon
Co-Founder at Rebus Financial Services
I get a sense that most mortgage borrowers aren't fully aware of the mortgage charter and what the details are. There is still a fear for many that contacting their lender for help with their mortgage payments will negatively affect their credit score and put their home at risk of repossession.

The clients I have spoken with are not keen on switching to interest-only for 6 months as it just feels like kicking the can down the road. Some clients have enquired about extending their term, but they are often already on a mortgage term of 30+ years so the difference in monthly payments is negligible.

It's positive to see lenders and the government collaborate to find a solution, but the mortgage charter feels a bit like papering over the cracks to me.