In 2024 we could be heading for the Great Mortgage scandal driven by climate change policy.
The basics are the Bank of England have a liquidity policy for banks and building society’s (Policy here) and in 2022 told lenders they must adjust there business to allow for the increased risks in the future due to climate change (Climate policy here) and do self assessment of their own risk. Businesses with too much risk can have ratings downgraded which could have a massive negative effect.
This coincided with the update to surface water flooding maps in 2023 and early 2024 which seams on paper to have massively in-creased the properties in flood risk areas
It seams that all money lenders have taken the same approach as to not take on any more flood risk properties on to their portfolio so anyone in flooding area’s coming to the end of their mortgage fixed rate turn has no choice but to stick with the same lender as no one else would offer anything. One owner has just seen his mortgage go from £800 (under 5%) if offered fixed rate had not been in Surface flood zone 3 to £1600 overnight (10.5%).
This way it keeps their lending at the same level with properties in risk to climate change.
The Netherlands is known for its unique characteristic of having a significant portion of its land below sea level. According to the search results, about one-third of the country lies below sea level, with the lowest point being 22 feet (6.7 meters) below sea level. This is due to the country’s geography, with the land being re-claimed from the sea over time and the water table being relatively high so this makes their risk so much higher than the UK.
The Dutch lenders are under same pressure as UK to migrate risk under climate change but by lending to UK customers in flood risk would do this as UK flooding is far less of a risk than the existing lending they have.
In UK most properties are dry and back to normal within a month after flooding but with some properties in Holland up to 6m below sea they could be destroyed totally with sea level rising
I have been consulting with a couple of Dutch equity suppliers and looks like we can quickly get some in place in next month or so.
They are also less restrictive with fixed rates from 4.90%, terms up to 15 years fixed for peace of mind but no early repayment or over payment penalties.
They are both in top ten lenders in the Netherlands so totally safe. Will update here soon.
For the few percent of properties in the flood zones this could be best of both worlds, taking climate change strain off both UK and Dutch banks.

(Policy )

(Climate policy)