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NatWest offers lifeline to foreign currency borrowers


NatWest Intermediary Solutions has offered a lifeline to borrowers who get paid in a foreign currency by confirming it will continue to offer such loans post-Mortgage Credit Directive.

Of all the lenders to announce their MCD changes, just Woolwich, TSB and Santander have confirmed they will offer loans to borrowers who are paid in a foreign currency.

While many lenders did not offer foreign currency loans in the first place, a number of larger lenders like Lloyds, Nationwide, Skipton and Bank of Ireland have decided to cease such lending.

NIS says it will monitor only the primary non-Sterling denominated currency for each mortgage. For interest-only mortgages, it will continue to accept only Sterling-based repayment strategies but it will accept foreign currency income.

The MCD requires lenders to disclose to customers where there is a fluctuation in exchange rates of more than 20 per cent.

NIS has confirmed it will use the European Standardised Information Sheet rather than the KFI+.

The MCD introduces regulated consumer buy-to-let for remortgage customers not acting for business purposes. The lender says it “plans to monitor the emerging market” for these mortgages – which it expects to be small – and will decide whether to introduce these loans before the end of 2016.

NIS will implement its post-MCD proposition in mid-January.

NIS service development manager Sarah Taylor says: “The MCD is a significant piece of legislation for the industry but one that we are well-placed to deal with. We believe it is sensible to adopt the requirements in mid-January well ahead of the deadline. By switching directly to the new Mortgage Illustration, it will mean making only one change to our systems which has to be good news for intermediaries.”



BoI/Post Office latest to can foreign currency loans

Bank of Ireland and the Post Office have become the latest lenders to pull out of foreign currency loans ahead of the Mortgage Credit Directive. From today, both lenders will no longer accept applications where the borrower receives income in a foreign currency. Further, all assets being used to repay an interest-only element must be […]


Nationwide halts new lending where income is in foreign currency

Nationwide has stopped lending to new borrowers who get paid in a foreign currency. The lender says it “may” consider income in a foreign currency for existing customers who are looking to move home and where no additional lending is required. There is no change to the treatment of term variations or changes to repayment […]

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