The Financial Conduct Authority has launched a market study to find out if competition in the mortgage market can be improved to help consumers.
The FCA says it wants to know if consumers have an “empowered” choice between products and services and can understand if these are good value for money.
The market study will explore two areas:
– If consumers can make “effective decisions” at each stage of the buying process, and how tools including advice affect this
– If commercial arrangements between lenders, brokers and other players lead to conflicts of interest or “misaligned incentives” that harm consumers
The FCA is focusing on first charge residential mortgages.
Areas it is interested in include best buy tables and the impact of the Mortgage Market Review.
The FCA will also review if better technology can help consumers, including greater use of digital channels to deliver information or advice.
The FCA announced the study and its focus in May and will report back next summer to give its preliminary conclusions.
It will then publish a final report in early 2018.
The regulator can then make new rules, publish new guidance or remove existing rules.
FCA executive director of strategy and competition Christopher Woolard says: “As a mortgage is likely to be the biggest financial commitment most people make in their lifetime, we’re keen to ensure that competition in the mortgage sector is healthy and working to the benefit of consumers.”