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A validation lifeline for small brokerages

The Financial Services Authority’s review Mortgage Fraud Against Lenders and recent MMR proposals mean a more complex and costly process for lenders wishing to source business from small, directly authorised firms.

The FSA’s announcement about further deferring implementation of the approved persons regime may prove to be the final straw for some lenders. With just one in three small DA firms having survived the credit crunch, the future of the rest hangs in the balance.

Many of these firms are well established. Their local business ethos provides a flexible backbone for the wider market. But some lenders, facing increased responsibility for vetting intermediaries, are showing less appetite for validating such firms. To survive, small DA firms may have to merge with larger businesses or networks, or risk being excluded by some lenders.

It is easy to see this leading to less choice for customers and a further concentration of risk in the larger intermediaries that emerge.

We are examining how small DA firms might join forces to create a central registration platform to provide the information to meet lenders’ compliance requirements.

A shared validation database could provide a lifeline for thousands of firms. The cost of such a solution would be more than matched by the benefits to customers and the industry.

If there is a will to progress this, the time for action is now – the clock is ticking.


Irish bank puts CHL sale on hold pending review

Irish Life & Permanent has delayed its decision on the sale of buy-to-let lender CHL Mortgages until the Central Bank of Ireland completes its review of IL&P. IL&P has had more than 10 bids for CHL. A sale was due to complete in the first quarter of the year but has been put on hold […]

Business borrowers need fair treatment

My last thoughts on the Mortgage Market Review before we submit our response to the Financial Services Authority concern a niche group that is subject to potentially significant changes – small business borrowers.

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Johnson Fleming set to host webinar on auditing auto-enrolment schemes

With 23 auto-enrolment compliance notices issued by the Pensions Regulator, and an evolving legislative landscape meaning previously compliant schemes may now be in breach of regulation, now is the time to think about auditing your auto-enrolment scheme. Johnson Fleming is hosting a webinar on 9 October at 11:00 on how to audit your scheme to ensure compliance, avoid breaches and fines and overcome data issues.


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