In AMI’s response to the FSA consultation on interest-only mortgages, Robert Sinclair, director of AMI, said: “The regulator’s apparent aversion to a type of borrowing that has served many consumers very well appears predetermined rather than driven by rationale.”
He added if interest-only mortgages are delivered on an advised basis and with a robust assessment for the customer, there is an appropriate place and use for interest-only mortgages.
“This is not an affordability issue on day one or subsequently. It is the appropriate use of a funding route which, with appropriate risk assessment, should leave individuals no worse off. We must ensure we do not sacrifice a good choice for many on the altar of perfection and certainty,” he said.
Sinclair added that Ami would continue to put the case for advisers acting in consumers best interests to be able to advise on the widest choice of products.
“Regulation should not make it so difficult that lenders see interest-only as so risky that the capital required to cover this prices it out of the market,” said Sinclair.
The broker trade body’s support for the CML, BSA and IMLA’s submissions on the interest-only paper, suggest the industry has vociferously united against the FSA’s interest-only clampdown.
