"This confirmation provides innovators like more 2 life the room to develop even better products for consumers who are looking to service some or all of their lifetime mortgage debt."
The lender says it wants to take advantage of the new regime and will be using feedback from advisers on how to improve the product further.
The FCA has confirmed that it will allow lifetime mortgage lenders to skip affordability assessments for interest-charging lifetime mortgages that can convert to roll-up mortgages.
The new modification works by dis-applying the requirement to carry out an affordability assessment where interest payments are anticipated or required, providing that the specific lifetime mortgage allows the consumer to exercise at any time an option to convert the product to interest roll-up.
more 2 life says it welcomes the move as the rules have "previously been restricting the market".
In its quarterly consultation, the FCA said: “There is evidence that our responsible lending rules could have contributed to the restricted development and take-up of lifetime products that allow a customer to make regular payments but switch to interest roll-up at any point.
“The cost of putting systems in place to check affordability is constraining lender entry into this market because lifetime mortgage lenders typically only offer interest roll-up loans.”
more 2 life says that by altering the rules on lifetime lending, "the FCA has opened the door for lenders to be more innovative, without compromising the high standards of this fast-growing market".
Dave Harris, Managing Director or more 2 life, said: “The FCA's announcement that they are going to relax their rules on things like affordability checks for interest-serviced lifetime mortgages is fantastic news. This confirmation provides innovators like more 2 life the room to develop even better products for consumers who are looking to service some or all of their lifetime mortgage debt. This is an important and growing area of demand and we intend to provide new, flexible product solutions to help meet it.”
