The Department of Trade and Industry (DTI) is set to revamp redemption penalties faced by borrowers, including those with second charge mortgages following a review of the 1974 Consumer Credit Act.
The review was announced in July 2001 and was geared towards stopping irresponsible lending and making sure borrowers knew exactly what they were entering into.
A spokesman for the DTI said he expected the recommendations to be made towards the end of the month.
Sue Anderson, head of external affairs for the Council of Mortgage Lenders, said she hoped the new rules would maintain the correct balance between lenders and borrowers. She added: ‘There is a need for the DTI and FSA to liase as a number of lenders will be operating under both regimes.’