Readers probably have mortgage regulation fatigue. But now is the final opportunity for advisers, if they have not already responded, to let the FSA know of any concerns they have about the proposed regulation.
The CML has responded to the FSA on behalf of lenders. But advisers are strongly affected by the new rules. Although they will not be directly authorised by the FSA, they will have to follow the rules about information disclosure, ‘as if they were a lender’. In turn, the rules require lenders to check information advisers provide.
It is obvious this will be a significant regulatory intrusion into lender/adviser relationships. One likely market effect, if the rules are implemented as currently drafted, is that lenders will cease to accept business from as many intermediaries as they do at present.
IT is also a big issue. Will the systems be available to ensure advisers can deliver the required illustrations in a compliant form?
The new regime is supposed to make it easier for consumers to shop around for mortgages. But one sillier requirement is advisers must submit copies of all pre-application illustrations they produce to the lender whose mortgage they apply for. The CML believes this is unnecessary as the adviser helps a client to shop around. The only illustration advisers should have to submit to the lender is the one that relates to the product being applied for.
Advisers who want to make their views known should write to: Sarah Wilson, Mortgages Head of Department, FSA, 25 The North Colonnade, Canary Wharf, London, E14 5HS.