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MMR: now the real changes will be felt
The consultation phase of the Mortgage Market Review ended last week and over the next couple of months we will see the results that will allow us to start to assess the impact on the mortgage market.
Many of the potential outcomes are unlikely to have an immediate effect as many firms have already made changes in anticipation of the outcome.
For example, it effectively banned self-cert loans, and that has already been implemented by the market.
But there are some areas that potentially could have a significant impact.
The approved persons regime will most likely include people who advise borrowers on regulated mortgage contracts.
So while previously the Financial Services Authority regulated the appointed representative it may instead oversee the registered individual, an extra 15,000-20,000 people.
That is going to be a big job and one that many are saying will have a disproportionate cost compared to the benefit.
My view is that, while it may be a pain to start with, the long-term benefits are worth it.
No doubt the registration process will flush out some people who are not fit and proper to advise borrowers and, more importantly, it will allow lenders to be much more accurate in targeting those whose standards are below a professional level.
ALAN CLEARY
MANAGING DIRECTOR
EXACT
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