FSA outlines initial disclosure format

The FSA is proposing that firms provide consumers with an initial disclosure document, telling consumers not only what the firm is able to offer them, but also what it cannot.

This is designed to allow the consumer to make an informed decision about whether to use a particular firm before deciding to go ahead with the transaction.

The document will tell the consumer which level of service the firm provides; which lenders the firm deals with; whether the firm charges for its services and, if so, how much; where the firm is an intermediary, whether it will receive commission from the lender; and, if the firm charges a fee, whether and in what circumstances it is refundable if the mortgage does not go ahead.

The FSA&#39s proposed suitability requirement includes an assessment of whether the mortgage is affordable; a requirement to match the different mortgage features to the consumer&#39s needs and circumstances; and an obligation, where several suitable products are identified, to recommend the mortgage that best meets the consumer&#39s needs and circumstances.