Prepare to face your destiny
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In a week’s time the mortgage market should learn its fate after months of guesswork. As the regulator prepares to unveil its Mortgage Market Review the industry is waiting with bated breath and rumours abound as to what might be announced.
As we reveal on page 4 this week, the consensus is that product regulation is off the cards but could this be too good to be true? As the industry knows only too well, the Financial Services Authority is a strange beast and at this stage of the game nothing is a given. If it steers clear of product regulation it will be a move welcomed by the Association of Mortgage Intermediaries, which has argued this would unnecessarily restrict consumer access to the housing market.
But if level proc fees become a reality it could throw up some issues. Along with reducing lenders’ ability to reward individual distribution streams it could lead to brokers placing clients on two-year deals rather than longer-term ones. And any restriction on proc fees may lead more brokers to charge fees and thus restrict the number of consumers who have access to advice.
More worrying are the changes the FSA is apparently looking to make to fast-track and self-cert. While prudence is obviously the in thing following the boom and bust culture the regulator would do well to remember there is some merit in self-cert as Matthew Wyles, group development director at Nationwide, points out on page 14.
Until the Mortgage Market Review is out brokers and lenders have to rely on their crystal balls, gossip or what the regulator tells them if they’re lucky. But soon hearsay and rumour will be set aside and the market will be able get on with rebuilding itself. Let’s just hope the FSA ensures the foundations are sound.
