Brokers also raised concerns over the future of the intermediary market, fearing that future delays from the regulator could be on the way.
Kevin Fowler, chief executive of Platinum Finance.co.uk, suggested that the cause of the delay is a result of the FSA facing intense pressure from the banks.
He said: “I see the delay as more of a political move with the FSA bowing to pressure from the big lenders in the market. The banks are undoubtedly more fearful of the Mortgage Market Review (MMR), especially after Nigel Stockton’s comments on the kind of costs that the banks would face once individual registration is implemented.
“The FSA knows that the broker community is ready for the Approved Persons regime, and by extending the delay to 2013 it only tarnishes its reputation. Its actions are holding back the mortgage market, and signal a warning that this is one of many delays that will be coming our way in the future.”
Fowler added that the delay will continue to weaken the distribution market as lenders continue to dual price.
“If the proposal had been implemented, then the MMR could have been the end of dual pricing, and would have strengthened the intermediary mortgage distribution market.”
Richard Adams, managing director at Stonebridge Group, said: “The most disappointing thing about the Approved Persons announcement is that, whilst many parts of the MMR have been widely condemned, the idea behind the individual registration of brokers is one of the few elements that was actually lauded and seemed to make the most sense to the intermediary community.”
He added: “Consumers need, and deserve, the protection and reassurance of knowing that the person issuing mortgage advice is individually regulated, in addition to the firm they represent. Unfortunately, with this delay, an opportunity has been lost.”
Sarah Bailey, spokesperson from the FSA, said that the regulator remains committed to Approved Persons and will continue to engage with the intermediary market until it implements the proposal.
She said: “It is a priority for us and any changes we make will be made at the right time.
“In the meantime, we are listening and engaging with intermediaries and trade associations to hear their thoughts and get their feedback, and we will continue to do so throughout the implementation process.”
Earlier this month, Michael Coogan, director general of the CML, welcomed the FSA’s decision.
He said: “With improved professionalism and a range of mortgage issues out to consultation, it is sensible to make changes affecting individual sellers at the same time.
“Bearing in mind the fact that firms would prefer to be able to budget and plan ahead for change, we are pleased to see the FSA taking a sensible and pragmatic approach on this issue for 2011.”
The FSA will publish a full economic analysis of all the MMR proposals next year, which will inform the final rules.
