From Simon Biddle
We welcome the clarification and direction that the FSA have given in both documents. Regarding the feedback on CP98, we welcome the change that firms or persons that do not give advice (that is introduce customers to authorised firms) will now be outside regulation. This is particularly important for intermediaries where mortgage business is peripheral.
Of cardinal importance to Preferred Mortgages is the treatment of packagers, mortgage clubs and correspondent lenders. The direction is clear; if you give advice the regulatory regime will apply. Many packagers do not give advice and as such will not be subject to FSA regulation. We welcome this approach.
The flexibility of the Treasury and the FSA in listening to the industry on the issues surrounding securitisation is particularly welcome. Also, we are particularly pleased to see that the consultation process has led to some changes. This proves that the consultation process works – for example, on the withdrawal of the proposed cooling-off period and amendments to the pre-application illustration (PAI). Preferred has been public in its view that intermediaries should take part in the consultation process. It would appear that the Treasury and the FSA have listened to the industry.
We are, however, disappointed that a single regulator has not been created for all secured loans. We feel this is an opportunity missed and hope that this anomaly will be addressed in the future. Additionally we are disappointed that the buy-to-let market has not come under FSA regulation.
The timescales for the introduction of regulation are generally satisfactory. However, I am sure that I will be speaking for all lenders when I say that the industry needs at least 12 clear months following the publication of the final rules to ensure a smooth introduction.
Marketing development manager