Mortgage regulation by the Financial Services Authority will come into play in October 2004, according to the Treasury.
Ruth Kelly, financial secretary to the Treasury, said: ‘Following consultation and publication of the final orders on mortgages, and the adoption by the European Parliament of the Insurance Mediation Directive, the date by which this will be achieved is confirmed as October 2004.’
While the Council of Mortgage Lenders (CML) welcomed the news, it warned regulation would only be practical if all mortgages were put out with the European Consumer Credit Directive, which is currently being drafted.
Michael Coogan, director general of the CML, said: ‘It would be unacceptable for the industry to have to go through a ‘big bang’ of statutory regulation in 2004, only to go through a similar comprehensive structural change under a European Directive. This simply would not be justified in consumer protection terms. We urge the UK Government to make strenuous efforts to ensure the carefully-laid plans for UK mortgage regulation in 2004 are not derailed by the Directive.’