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<p>This Government's long term economic plan has kept interest rates at record lows
for hardworking people across the country.</p><p> </p><p>Many lenders impose affordability
stress tests on their mortgage lending decisions to ensure that the mortgage will
remain affordable should interest rates rise. The Financial Conduct Authority's Mortgage
Market Review rules, which came into force in April this year will require all mortgage
lenders to conduct such a stress test.</p><p> </p><p>Although UKAR does not engage
in new lending, UKAR runs a range of modelling scenarios to understand the potential
effects of interest rate rises on customers. This work helps UKAR to identify customers
who may be susceptible to higher interest rates and to engage with such customers
at an early stage.</p><p> </p><p>UKAR assists all customers who wish to switch mortgage
providers.</p><p> </p><p>NRAM and Bradford and Bingley are managed by UK Asset Resolution
Limited (UKAR) which was established in 2010 to manage the disposal and rundown of
outstanding assets at Bradford & Bingley and Northern Rock Asset Management in
an integrated way, with a view to creating value for the taxpayer. UKAR is managed
at arm's length from Government, on commercial principles.</p><p> </p><p>It is therefore
not for the Chancellor to discuss detailed commercial matters with UKAR.</p><p> </p>
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