FCA has released its latest report on mortgage switching, from which it concludes there is a case for intervening to help customers who do not switch. It has found that the reasons people have for not switching including lack of time, fear of the application process and often being relatively happy with the deal they have. FCA also says that customers who don’t switch as less likely to be vulnerable when measured against the general population but that they may become better engaged with the switching process if they have the right information at the right time.
The research showed that:
- the average income of those not switching was slightly less than of those who did – and that those who switched externally had average higher incomes than those who switched internally, who in turn had higher incomes than those who did not switch;
- non-switchers tend to live in areas that are neither particularly deprived nor particularly affluent;
- 90% of those who switch were 50 or younger, with an average age of 36;
- single-name borrowers were less likely to switch than others; and
- people who did not switch were less likely to have used a broker to find their initial deal than those who did switch.
FCA now proposes to consult on remedies during Q2 2020.