Leader: Two years on, still no MMR

The regulator was busy last week not only did it reveal the findings of its Mortgage Fraud Thematic Review but also that it will not be publishing its Mortgage Market Review proposals until the autumn.

Brokers and lenders seemed to welcome the MMR news as it shows the Financial Services Authority is willing to listen and engage in a debate with them. The Association of Mortgage Intermediaries was one of the few organisations to express some disappointment and it is easy to see why.

The MMR was first announced by the FSA in October 2009 and we still have no final rules. Some may rejoice in this, but while the regulator continues to be indecisive, lenders are tightening lending criteria and the market is on a far from stable footing.

The regulator has had almost two years to carry out its analysis of the market and gauge industry feedback surely the time has now come for some sort of clear stance from it, whether we like it or not.

The FSA has stressed that it will not wait for Europe to dictate regulation but if it delays its proposals any further there is little point in not waiting for Europe. At least then the market could take the regulatory hit in one go.

Meanwhile, it was surprising to see how many references the FSA made to the fraudulent behaviour of brokers in its thematic review last week after all, the paper was supposed to focus on lenders. It is also interesting that it has not taken any enforcement action against lenders despite discovering weaknesses in some anti-fraud systems. Let’s hope that if no improvements are made the regulator will not hesitate to come down hard on lenders as it has on brokers in the past.