The FSA gives and takes

19 December 2011 | By Robert Thickett

For the wider mortgage intermediary market there are some positives. While self-cert mortgages have been consigned to product hell, fast-track servicing has gained a partial reprieve – brokers will now be required to provide evidence of income to the lender.

The ban on non-advised sales means lenders must train their advisers to be CeMAP qualified – a considerable expense that will doubtless lead to more lenders using brokers. 

But while the FSA giveth, in equal measure the FSA taketh away. For the bridging industry it’s certainly a lump of coal and ditto those providing non-advice.

On the negative side, the regulator warns that by forcing lenders to take greater responsibility for affordability assessments they could become more involved in the application process.

Likewise, for brokers to keep their independent tag they will have to mention direct deals as well, which could spur more borrowers to go direct.

Hopefully banning non-advised sales versus greater control of affordability assessments will balance each other out. The UK mortgage intermediary market is a scaleable distribution model that lenders and borrowers love – the advantages it provides over direct are great and hopefully it will take more than the MMR to change this.

Merry Christmas and a happy New Year. Let’s hope next year is not as bad as everyone is predicting. The first issue of Mortgage Strategy in 2012 is out on January 9.

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