What does this mean to you?
The Mortgage Credit Directive (MCD) is an EU wide initiative that aims to create a union wide mortgage credit market with a high level of consumer protection. It’s closely aligned with existing mortgage regulations, however there are a few changes to highlight.
When will we implement MCD?
KFI+ or European Standardised Information Sheet (ESIS)
Binding Mortgage Offers and a reflection period
What if your application is in the pipeline on 21st March 2016?
Will foreign currency mortgages be offered?
Changes to Buy to Let mortgage definitions
Outside of MCD, further HMT changes are also being made from 21st March, 2016 to the definition of BTL loans, which will be referred to as either Consumer BTL (CBTL) or Investment Property Loans (IPL).
CBTL will apply to re-mortgage applicants who don’t own any other let properties and either:
IPL will apply to anyone:
- wish to let their current residence while purchasing a new home(known as Let to Buy)
- have inherited the property and wish to let it
- have themselves, or a close relative, previously resided in the property, and now wish to let it.
- purchasing a property specifically to let
- re-mortgaging an existing rental property
You will be required to confirm to us which type of BTL mortgage you are submitting. This will be done within the Application Manager
system, by selecting the correct option. Our BTL decision tree
may help you in making your decision
All advisers submitting a CBTL application will need to hold the relevant CBTL FCA permissions in addition to their normal mortgage permissions.
The way we assess BTL cases, and the choice of products on offer, will be the same for both CBTL and IPL.
Note: We do not currently accept MCOB regulated BTLs (e.g. where an applicant is letting the property to family members).