The Express – By Lana Clements
BRITISH homeowners are being urged to remortgage NOW to escape “bonkers” new EU rules that come into force this autumn.
Personal finance expert Martin Lewis, founder of website MoneySavingExpert.com, has advised mortgage holders to check they are on the right deal and look for a better rate as soon as possible.
The new EU laws could see UK homeowners stranded on their lender’s expensive Standard Variable Rate (SVR) when their mortgage term comes to an end.
The EU ‘Mortgage Credit Directive’ officially comes into force in March 2016 but can be backdated by six months.
In effect, the directive is an extension of the mortgage affordability criteria that was introduced into Britain last year.
The stringent rules stress test borrowers to make sure they can afford their mortgage deal, not just now but if interest rates were to rise to six or seven per cent.
Under British rules lenders can bypass the checks when an existing homeowner is remortgaging. But under the EU directive lenders won’t be able to do this…