This was the warning from Mike Coady, managing director of de Vere mortgages, who said that one of the rules being brought in next March as part of the MCD was greater disclosure of possible exchange rate fluctuation.
Under the incoming directive, firms must disclose where there is the possibility of exchange rate fluctuation and where an adverse movement in exchange rates has occurred.
They must also put in place systems to protect borrowers from exchange rate risks.
Mr Coady said this would affect any expatriate who, for example, might be coming back to the UK and seeking to buy a house with a foreign currency, such as Hong Kong dollars, while taking out a UK mortgage.
He said: “Consumers will have the right to convert the currency of a foreign currency mortgage into an alternative currency in specified conditions. As a result of this, lenders are reviewing their plans for the provision of expat mortgages, with some having decided to withdraw.”
Bernard Clarke, communications manager for the Council of Mortgage Lenders, said: “Lenders do not have to comply with the directive until March next year, so we will have to wait and see exactly how it affects the market. But we have predicted that some of the measures could lead to a narrowing of choice for consumers, particularly in the provision of foreign currency loans and consumer buy-to-let mortgages.”