Speaking at a conference held by the Association of Short Term Lenders (ASTL), Lynda Blackwell, head of mortgages at the FCA (pictured), praised the industry’s cooperation with the regulator in providing transparent data, adding that they “deserved credit”, but noted that reputation in the sector was “easily brought down by the less scrupulous firms.”
“We have no data on the unregulated side of the market. No-one knows for sure what the size of that market is and based on the figures we have, it could make up 84% of the sector today and that goes largely under our radar,” Blackwell explained.
“Concerns continue to be raised with us about the quality of business on that side and strategies can appear to be deliberately designed to circumvent regulation.”
Blackwell referenced a query dealt with a member of her team from a lender requesting the definition of a regulated mortgage contract. It transpired that the lender was being pressured by a broker to accept a deal as unregulated, which would in fact be treated as a regulated contract under the FCA’s rules.
“The sector needs to take care to ensure that business that should be regulated, isn’t being written as unregulated,” she added.
Blackwell called on the bridging industry to inform the FCA if there were aware of any firms acting unscrupulously in the sector.