It says that only 2 per cent of existing borrowers who would benefit from switching were unable to switch, either internally or externally. The most common reasons were their employment status, level or security of income, or because they had an interest-only mortgage.
The study also identified a further 120,000 borrowers likely to have problems switching. This is because their mortgages have been sold to firms not authorised for lending, so they have no other products to which the borrowers can remortgage.
The FCA estimates that roughly 10 per cent of regulated residential mortgage consumers fail to switch from a reversion rate to a new mortgage deal. It calculates that on average they could have saved around £1,000 a year in the first two years, and £100 annually for the rest of the term if they had switched in June 2016.
One final initiative of note is the commitment to working with borrowers to make it easier to compare mortgage brokers. The FCA plans to publish its final study findings around the end of the year.
