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After England’s Euro failure, mortgage market must avoid own goals

by: Andrew Baddeley-Chappell
  • 03/07/2012
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After England’s Euro failure, mortgage market must avoid own goals
Whilst the England football team ended its campaign in Europe with a whimper, the UK Mortgage Market is still battling away in the EU Mortgage Directive competition.

We have now proceeded beyond the group stage and are through to the knock out phase of the competition – it is just not quite clear when the next matches will be.

During the first round a number of the outside threats have been defeated, however there are still some challenges that remain.

It looks like the UK will be successful in keeping buy to let outside the EU framework completely or in part – although it remains very definitely on the FSA’s radar.

It appears that the UK has also gained some time before having to replace our KFI with the inferior ESIS (definitely a poor substitution).

UK lenders remain concerned that proposed rules around early repayment charges, standard variable rates (both disclosure requirements and rule setting) and tied products (although these are aimed at improving competition) may have unintended consequences.

One problem is that the EU is effectively three different teams – the Council (member states) the Commission (the civil servants) and the Parliament – and these teams have their individual ideas as to how the final directive should work.

The final looks like being played towards the end of the year, with the UK having two years to convert the final document into regulation.

As well as focussing on Europe we must also remember that we have our own domestic competition heading towards its own finale in the autumn.

Just don’t mention the Olympics!

Andrew Baddeley-Chappell is head of mortgage strategy and policy at Nationwide

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