Discussions on whether remote mortgage sales should be regulated have been stirred, following the Mortgage Code Compliance Board’s (MCCB) decision to ditch plans to create a new set of rules for mortgages bought over the internet.
The MCCB set up a working party 18 months ago to look at the role of ‘info-mediaries’ ‘ websites offering comparative mortgage tables and product information ‘ to ask whether they should come under the MCCB’s regime. Despite calls from the working party saying there was a need to protect borrowers by drawing a clear line between information and advice, the watchdog has ditched plans to follow its proposal through.
However, the MCCB, which will hand over regulatory reigns to the Financial Services Authority (FSA) in 2004, said it will publish further reports on remote selling ‘ in particular, call centres ‘ and advise the FSA on its findings.
Brad Baker, spokesperson for the MCCB, said: ‘The MCCB will not be issuing a separate code of conduct for e-mortgages. We have issued guidance on remote sales and may publish further reports. Call centres is the area we are interested in and we will pass our recommendations onto the FSA to consider.’
The MCCB’s concerns over remote selling are still evident as it has tackled the subject in the latest issue of MCCB News. According to its good practice notes, there is confusion among consumers about whether advice is given when they contact websites or call centres for product information.
The notes read: ‘It is evident from compliance monitoring and customer correspondence received by the board there are frequent instances where the firm indicates it has provided information only, while the customer perception is that they have received advice.’
The FSA said it would be considering regulating remote selling, but nothing could be confirmed until the Treasury had finalised details of the regime.
Spokesperson for the FSA, Robin Gordon-Walker, said: ‘In principle, there is no difference between a customer receiving advice face-to-face or over the internet, so we will have rules concerning remote selling. However, this will all fall under a general regime as we do not want customers to be hampered by regulation simply because they use a particular medium.’