Speaking at the Legal & General Mortgage Market Roadshow, Jenny Clayton, director at Ernst & Young, said the current regulatory landscape of fines and bans would only get more challenging.
This was particularly true when it comes to the Consumer Protection Market Authority, Clayton said, as distribution and retail sales will be the only areas the regulatory body will concentrate on.
Clayton said: “Brokers will be dealing with the big banks and lenders are very worried about getting caught doing something wrong by the regulator. Brokers should think about the risk they present to lenders, as they can play that to their advantage if they present themselves well.”
In addition, she said that it was very likely that there would be a major industry-wide interest-only mortgage back book review: “A lot of customers are going to have to restructure their loans and many will not do it with their lenders, so this could be a business opportunity for brokers.”
However, she warned that brokers must prepare themselves for an environment where they are expected to be more qualified, particularly by lenders who may insist upon qualifications and CPD requirements.
Clayton also predicted that intermediaries could face tougher requirements around oral disclosure, while the industry could well see LTV and loan-to-interest caps if the housing market falls into a double dip.
