Mortgage News
FSA strengthens protection for SRB consumers
The FSA has proposed a ban on exploitative advertising and high-pressure sales techniques as part of further attempts to protect vulnerable consumers in the sale and rent back (SRB) market.
Under the proposals, which are open for responses until 30 November 2009 and due to come into effect on 30 June 2010, the regulator wants to prohibit firms from dropping promotional leaflets through letter boxes and prohibit the use of terms like ‘fast sale’, ‘mortgage rescue’ and ‘cash quickly’ in literature.
Ed Harley, head of mortgage policy at the FSA, said many of the people targeted in SRB are financially vulnerable and have been badly hit by the experience.
He added: “The FSA’s proposed new rules will help to protect consumers. We want to prevent high-pressure and inappropriate sales, and help consumers understand SRB products, so they only enter into SRB where it is an appropriate and sustainable solution for them.”
The FSA has already proposed that consumers must be sold suitable products which take account of their circumstances, needs, and affordability. Consumers must also have time to consider the nature of the product and possible alternatives before reaching a decision.
SRB interim regulation started on 1 July 2009 and the full regime will begin on 30 June 2010.
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