The MCD rules come into force on 21 March 2016 which means that second charge loans will be treated the same as first charge mortgages with advisers under obligation to consider all financial options for their customers.
But industry surveys and feedback from network heads has revealed that the industry is not prepared for the MCD deadline with a blanket of silence now covering the market about exactly how lenders are going to deal with this in practice.
At the annual public conference held in the QEII conference centre in Westminster today, Mortgage Solutions told Wheatley the sector was unprepared and asked him how the regulator was planning to deal with the issue.
Wheatley was unable to say exactly how the regulator intended to step in with guidance for lenders and firms.
“…we will work with firms to give guidance where we need to and if there are aspects of the Mortgage Credit Directive where we need to do that then we supply that sort of guidance” said Wheatley. “It’s hard to be more specific and as you say we are still working through the detail.”
In a recent Mortgage Solutions poll the majority of brokers who responded said they were unprepared to conduct business in the second charge market. Some 43% of respondents said they had not yet started training to conduct secured loan business.
