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Financial Services Authority will continue to deliver on projects such as the MMR until the new regime comes in
New regulators in 2012 will carry on with FSA policies
DAVID GEALE ACTING MORTGAGES SECTOR LEADER FINANCIAL SERVICES AUTHORITY
As readers will be aware, the government has proposed changes to the organisations that regulate the mortgage sector and the wider financial services industry.
But rest assured that regulation is here to stay and until 2012 you will be regulated by the FSA and should continue to deal with us in the usual way.
Our intensive regulatory model remains in place and will be carried forward into the successor bodies. We will also continue to Market Review and Retail Distribution Review as these are important consumer protection measures that will be taken
forward by the new regulators.
On the subject of the MMR, Mortgage Strategy readers will be interested in our recent policy statement about the approved persons regime.
From March 31 2011, all individuals who advise on or bring about home finance transactions will be individually accountable to the FSA.
In the meantime, we will collect feedback to our consultation paper on responsible lending
This means anyone undertaking this business will have to demonstrate they are fit and proper for their role and once authorised they will have to continue meeting these requirements. This applies to both intermediaries and lenders.
This move has broadly met with support from the main trade bodies as it will prevent unfit or rogue individuals from entering the industry and reduce the potential for fraud.
It will also help us ensure that inappropriate or non-compliant behaviour is dealt with swiftly and fairly.
This is a further example of where we are applying a more intensive approach to regulation to drive up standards. We believe this is good for consumers and for the industry as a whole.
In the meantime, we continue to collect feedback on the consultation we published in July on responsible lending - Consultation Paper 10/16.
The aim is to get back to basics - consumers borrowing what they can afford to repay.
As I pointed out in my last column in a key part of this is our proposal to ensure lenders make an assessment of affordability in every case.
Although brokers still have a role to play in looking at affordability and the suitability of products, the FSA believes it makes sense for lenders to bear ultimate responsibility for affordability and to be held accountable for the lending decisions they take.
It is, after all, lenders that bear the risk of holding the mortgage on their books.
If you wish to respond to our proposals you can let your trade body know what you think or use the response form on our website.
