The FCA has published a modification by consent relating to hybrid lifetime mortgages and the application of a new rule in chapter 9 of the Mortgages and Home Finance Conduct of Business sourcebook (MCOB).
An accompanying FCA webpage explains that it has made the modifications because it does not consider that an affordability assessment is required where there is no risk of arrears and repossession in the event of missed payments. It also makes changes to the product disclosure rules in MCOB 9.4 and the prescribed text of the key facts illustration (KFI) in MCOB 9 Annex 1, so that the KFI gives a meaningful description of features and risks both when interest payments are being made and when they are rolled up.
The modification applies to lifetime mortgage providers and intermediaries and is valid until 7 April 2017, or earlier if any of the affected rules are amended or revoked.
View FCA modifications by consent for hybrid lifetime mortgages, 7 April 2017