How Easy Could it be to obtain a Mortgage in Scotland After an Independence ‘Yes’ Election?

How Easy Could it be to obtain a Mortgage in Scotland After an Independence ‘Yes’ Election?
December 16 04:57 2015 Print This Article

Lenders would have to review their mortgage operations and rates of interest could rise. This is the look at leading experts when the Scottish electorate election for independence within the referendum in September 2014.

A Treasury report has asked whether Scottish banks could fund a effective financial compensation plan while lenders have confessed they would need to review their position within the Scottish mortgage market in case of a ‘yes’ election. Keep studying for more information.

Lenders would have to review their mortgage business in case of Scottish independence

The Scottish Government promises to hold a referendum from the Scottish electorate around the issue of independence in the Uk on Thursday 18 September, 2014. Independence is based on the Scottish National Party and Scots is going to be requested to election on whether Scotland should become a completely independent country.

In case of a ‘yes’ election, Money Marketing reports that lenders’would have to review their mortgage operations in Scotland.’ Building Societies Association mind of mortgage policy Paul Broadhead states lenders will need to review their position when the electorate decide to leave the United kingdom.


He stated they will have to understand what the legal structure is going to be and just what currency they’ll use. When not area of the United kingdom they’d should also determine if it will likely be area of the FCA regulatory regime. Otherwise, then lenders, who now are obliged to conform using the FCA rules will need to review their position. It does not mean they’ll take out or even the mortgage market but they’re going to have to reflect on the potential risks.

A ‘yes’ election might also result in more costly mortgages north from the border. The Council of Mortgage Brokers think that when lenders suffer from different legal and regulatory systems then lending gets to be more difficult and much more costly for that customer.

Could Scottish independence help make your mortgage more costly?

A current Treasury report contended that the election towards Scottish independence often see the price of quality value mortgages in Scotland rise.

In case of a ‘yes’ election, Scotland could be forced under European law to possess a separate financial regulatory system and it is own deposits guarantee fund, to pay savers in case of the failure of the lender.

The Treasury report has known as into wonder if a completely independent Scotland could generate a financial compensation plan which was sufficiently well backed. And, without it, the Treasury believes that there might be a loss of revenue of confidence in Scottish banks, leading to customers making less deposits to finance mortgages.

John Swinney, the Scottish finance secretary, ignored such claims, stating that the United kingdom government are utilizing this paper to create implausible claims by what may happen to home loan rates, when in fact many countries around Europe, including individuals of comparable size to Scotland, have substantially cheaper home loan rates compared to United kingdom.

Islay Robinson, Chief executive officer based in london mortgage advisor Enness Private Clients, stated: “Deficiencies in confidence in Scottish banks indicates they’ve already to provide better savings rate to draw in deposits or fund their mortgages through greater utilisation of the wholesale markets. This might certainly push-up the cost of huge mortgages within an independent Scotland.”

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Jena Shepherd
Jena Shepherd

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