We may be just five months on from the implementation of the MMR but we now have the spectre of the EU mortgage credit directive looming large.
The aim of the mortgage credit directive is to create an EU-wide mortgage market with a higher level of consumer protection.
The directive will certainly have an impact on anyone who deals in second charge loans as it will apply equally to both first and second charge mortgages but also raises the topic of cooling off periods for mortgage clients and the abolition of ‘unreasonable’ early repayment charges.
Just as the MMR-cloud starts to settle, mortgage advisers are left with little time before gearing up for the next raft of legislation changes. Sure, there is a desire that the directive causes as little impact as possible, but firms will still have to prepare and implement these changes, with the inevitable cost and time resource attached.
In the long run, the regulating of first and second charge loans in the same way should make things simpler; however in the short term it is yet more compliance to get to grips with. If you are a broker with little time to read through consultations hundreds of pages long, finding the right compliance support may just be the thing that sets you on a level playing field.
The process of public consultation on the directive has recently begun and will end at the close of October. This has left mortgage advisers with limited time to fully grasp the compliance changes tabled. Implementation will then be hot on its heels with the final rules being announced next March and the directive coming into force by April 2016.
Furthermore, will you be ready to apply for your permissions a year earlier in 2015?
A mortgage club therefore, is about more than just offering products and commission rates, although of course these are important too. Having the necessary support services is vital – so pick up the phone and ask your mortgage club about how they can help you.
Compliance support from your mortgage club should be simple, making the process as smooth and efficient as possible, alerting you to key government and FCA papers and delivering expert advice and practical help when it’s needed.
If you’re considering extra compliance support from a mortgage club, make sure you have a tailor made service that works best for you and your business. Select a service that offers choice and doesn’t pigeon-hole you into a ‘sole trader’ or ‘medium sized business’ box.
From regular compliance updates to face-to-face visits and audits, the right mortgage club should be able to provide you with a bespoke package to meet your businesses’ individual requirements.
This sort of support will be increasingly necessary as the European Commission has indicated that it will be carrying out further work around mortgage foreclosure, default and underwriting requirements.
The directive itself also provides for a review after five years, therefore, you will need to maintain your knowledge of any regulatory changes that may affect your business moving forward.