The Financial Services Authority says it still has concerns about Initial Disclosure Documents, with one out of two containing five or more errors.
Speaking at the Mortgage Business Expo, Clive Briault, managing director of retail markets at the FSA, says although the regulator has been encouraged by the fact that consumers find Key Facts Illustration and IDDs both useful and accessible, it’s still concerned about the number of errors contained in IDDs.
He says: We have continued to find cases where disclosure documents are not inline. One out of two IDDs contain five or more errors. This is a concern. We are trying to deliver more principals based regulation and in some areas we need more rules and guidance with disclosure in particular.
Briault also says the FSA has identified that problem areas include affordability, retirement, interest-only mortgages and competence and training.
It has found that in some cases affordability is not being discussed with the customer at all.
He says: We are worried about affordability but it is too early to assess how big the problem is. Both advisors and lenders have responsibility to affordability.