Mortgages taken out before 2004 under the Consumer Credit Act

If you took out a mortgage before 2004, it may sit under a different rulebook from the one that governs loans taken out today. The Consumer Credit Act 1974 has regulated consumer credit for fifty years¹, and older first charge mortgages were caught by it where the loan was small enough. Most first mortgages taken out on or after 31 October 2004 are regulated by the FCA's MCOB rules instead².

The dividing line is usually the loan size. Credit agreements taken out before 1 May 1998 were regulated only up to £15,000, and those taken out between 1 May 1998 and 5 April 2008 only up to £25,000³. From 6 April 2008 there is no financial limit, unless the loan was for business purposes⁴.

That matters because the two regimes give you different rights on early repayment, statements and complaints. This page sets out how to tell which one applies to your loan, what changed when the older loans moved across, and where to go if something goes wrong.

Which older mortgages were regulated under the Consumer Credit Act

The Consumer Credit Act 1974 has provided the framework for consumer credit since 1974¹. It covers credit cards, loans, overdrafts, store cards, high-cost credit loans and hire purchase⁷. Older mortgages sat inside that framework where they met the Act's conditions, which is why a pre-2004 home loan can behave differently from one arranged today.

The Act does not reach everything. It may not cover all credit union or buy now pay later debts, it does not apply to companies providing gas, electricity, water or phone services, and it does not cover councils⁸. Those exclusions matter if you are trying to work out whether a particular agreement was ever regulated.

For mortgages specifically, the practical test is the date and the size of the loan. A first charge mortgage taken out before 31 October 2004 that fell within the financial limits was a regulated consumer credit agreement. A first charge mortgage taken out on or after that date is normally regulated under MCOB, the FCA's Mortgages and Home Finance: Conduct of Business sourcebook².

Second charge mortgages are a separate case. A second charge sits behind the first mortgage, so if the home is sold to pay debts, the first mortgage is paid off first⁹. That ranking affects what a lender can recover and when, and it is one reason the rules for second charge lending have followed their own path.

Loan size limits that decide whether your mortgage qualifies

The financial limit is the single most useful fact for working out whether an old mortgage was a regulated agreement. The figures changed twice.

Those limits applied to credit agreements generally, not only to mortgages, and the same figures appear across the debt advice guidance¹⁰. The £25,000 ceiling is the one that catches most pre-2004 mortgages: a loan above it fell outside the definition of a regulated agreement.

That point was made explicitly in the rules for the motor finance commission redress scheme, which state that before 6 April 2008 a personal credit agreement providing credit exceeding £25,000 fell outside the definition of a regulated agreement under the CCA¹². The same logic applied to mortgages of that era.

There is a further wrinkle in the Act's own history. The small agreement threshold under section 17(1)(a) and (b) was changed, with £35 substituted for £50 for agreements under the Cancellation of Contracts made in a Consumer's Home or Place of Work etc. Regulations 2008¹³. That is a narrow point, but it shows how the Act's thresholds have been amended over time rather than fixed.

If your loan was above the limit for its date, it was not a regulated agreement under the Consumer Credit Act, and the rights described on this page may not apply to it. If it was at or below the limit, they generally do.

What changed when these mortgages moved under mortgage rules

The rules changed on 21 March 2017. From that date, affected pre-2004 first charge loans became regulated mortgage contracts, unless the firm chose to adopt the new rules earlier⁵. The Financial Ombudsman Service set out the transition in a policy statement, including the statement timing that firms had to follow⁵.

The change was not instant for paperwork. The firm had to provide the first statement required by MCOB 7.5.1R no later than thirteen months after the date on which the last statement required under section 77A of the Consumer Credit Act was due⁵. In practice that means there could be a gap of more than a year between your final CCA statement and your first MCOB statement.

The MCOB rules themselves set out what a firm must capture for a new regulated mortgage contract. Under MCOB 4.8A.14, the customer must specify at least the name of the mortgage lender, the rate of interest, the interest rate type, the price or value of the property, the length of term, the sum to be borrowed, and whether the mortgage is interest-only or repayment¹⁴.

Separately, the Consumer Credit (Agreements) (Amendment) Regulations 2004 amended the Consumer Credit (Agreements) Regulations 1983 and came into force on 31 May 2005¹⁵. The Consumer Credit (Early Settlement) Regulations 2004 also came into force on 31 May 2005¹⁶.

There is a live question about what happens next. In May 2026 the government announced it would repeal much of the law governing consumer credit¹⁷. That is a proposal, not a change in your rights today, and it is covered in more detail on Reforming the Consumer Credit Act: what could change for borrowers.

Early repayment and arrears charges on a legacy mortgage

If you pay off a legacy mortgage early, the calculation follows the Consumer Credit (Early Settlement) Regulations 2004. Those regulations replaced the Consumer Credit (Rebate on Early Settlement) Regulations 1983, subject to a saving for agreements entered into before the commencement date⁶. They also amend the Consumer Credit (Settlement Information) Regulations 1983, which deal with your right to a statement showing the amount payable to settle a debt under a regulated consumer credit agreement⁶.

Under the Consumer Credit Act you are entitled to a settlement figure from your lender, and that figure could include a charge for repaying the loan early¹⁸. The relevant regulations for the calculation are the Consumer Credit (Early Settlement) Regulations 2004 and the Consumer Credit (Settlement Information) Regulations 1983¹⁹.

The 2004 regulations do not apply to everything. They exclude agreements for running-account credit, land mortgages with no instalment repayments or interest due while the debtor occupies the mortgaged land as their main residence, and hire-purchase or conditional sale agreements terminated under section 99 of the Act¹⁶. If your mortgage falls into one of those categories, the early settlement rules work differently.

The regulations also carried a savings period. Until 31 May 2007, if the agreement was for a term of 10 years or less, and until 31 May 2010 if the agreement was for a term of more than 10 years, the older arrangements continued to apply to regulated consumer credit agreements entered into before the regulations came into force⁴.

On arrears, the Financial Ombudsman Service expects lenders to show flexibility. It has said it would expect to see that a lender had allowed a customer to change the date of their monthly mortgage payment, for example where the customer had moved to a new job with a changed salary payment date²⁰.

Before possession action, a lender should give you details of your payments over the past two years, the amount of your arrears, how much is left to pay on your mortgage, and the interest or charges that will be added²¹. That is a pre-action requirement, and it applies whether or not your loan is a legacy CCA agreement.

Annual statements: when yours is due

Under the rules in the Consumer Credit Act 1974, creditors will normally have to keep sending you annual statements, as well as arrears and default notices in a set format²². That obligation continues even while you are in a debt management plan²³.

An annual mortgage statement tells you how much you have repaid so far, how much you still owe, and any charges you may incur if you pay the mortgage off entirely²⁵. If you have a legacy CCA mortgage that moved across in 2017, the first statement under the new rules was due no later than thirteen months after the last statement required under section 77A of the Consumer Credit Act⁵.

The MCOB 7 annual statement requirements apply only to disclosures from 21 March 2017, or an earlier date when a firm chose to adopt the rules early⁵. So the exact date your statements resumed depends on when your lender made the switch.

If you stop receiving statements, the first step is to ask the lender in writing and keep a record of the request. The Consumer Credit Act 1974 gives you rights to information about your agreement, and the debt advice charity Business Debtline publishes guidance on getting information about credit agreements²⁶. If the lender does not respond, that is itself something you can raise as a complaint.

There is one narrow point worth knowing about information requests. Section 158 of the Consumer Credit Act provides that if an agency does not keep a file relating to the consumer, it shall give the consumer notice of that fact, but need not return any money paid²⁷. That applies to credit reference agencies rather than lenders, but it explains why a request for information can come back with a "no file held" answer.

Does it matter if my mortgage is a second charge rather than a first charge?

It can, in three ways.

First, ranking. A second charge sits behind the first mortgage, so if you failed to meet repayments and the home was sold to pay off debts, the first mortgage would be paid off first⁹. That affects how much a second charge lender can recover and how quickly it may act.

Second, the Mortgage Charter. It is unclear whether the Mortgage Charter applies to second charge mortgages²⁸. The Charter is the set of commitments lenders signed up to on payment holidays and repossession, and it is covered on The Mortgage Charter: what lenders signed up to. If you are not sure whether your lender treats your second charge loan as covered, ask them directly.

Third, the alternative. A further advance from your existing first mortgage lender may result in the borrower losing a preferential interest rate or paying early repayment charges²⁹. That is the trade-off between adding to the first mortgage and taking a separate second charge.

Second charge lending has its own representative body, the Finance & Leasing Association, which publishes material on second charge mortgages²⁸. The Financial Ombudsman Service also reports complaint volumes by product: 124 second charge mortgage complaints were opened in Q1 2026/27³⁰, against 4,553 first charge mortgage complaints in 2025/26³¹.

Complaints and help if you fall behind

You can complain to the Financial Ombudsman Service if you are unhappy with your lender's response, including over secured loans under the Consumer Credit Act 1974³². Under the Consumer Credit Act 2006 there are rights to complain to the Financial Ombudsman Service about how a lender or debt collection agency has dealt with your account, and you normally need to follow the lender's complaints procedure first³³.

The ombudsman's remit covers complaints about advice you received from a financial business, complaints about mortgage arrears and charges, complaints about not being able to change or move your mortgage or take a payment holiday, and complaints about repossession before possession takes place or after it has happened³⁴.

There is a limit on how far back some complaints can go. For products taken out or advice given before certain regulation dates, your complaint may be rejected: 2004 for lifetime mortgages and 2007 for home reversions³⁵. That is a different regime from the CCA mortgages described here, but it shows that pre-regulation products can fall outside the ombudsman's reach.

The FSCS has its own cut-off. For mortgage advice and arranging, it will only be able to help if a claim relates to business conducted on or after 31 October 2004³⁶. That is about compensation for failed firms, not about complaints against a lender that is still trading.

If you are behind on payments, free and impartial help is available. The Financial Ombudsman Service publishes consumer guidance on financial difficulties with mortgages³⁴. National Debtline publishes a guide on mortgage shortfalls in Scotland³⁷, and on refused offers in Scotland³² and in England and Wales³³. National Debtline also publishes a guide on debt management plans in Scotland²³, and Business Debtline covers individual voluntary arrangements in England and Wales²⁴. StepChange explains what happens with a county court judgment³⁸, and Shelter Cymru covers going to court over mortgage repossession²¹.