Solent Mortgage Services has been testing a product suitability file checking service over the last three months with selected lenders and has now formally launched the facility to its introducers through its online extranet, The Porthole.
Designed and built by specialist provider, Compliance Checking, the service provides intermediaries and lenders with a free facility which provides reassurance that the product they have recommended to clients will meet suitability guidelines and standards.
Ian Balfour, CEO of SMS, says: “Firstly, we know that the FSA is going to pay particular attention to cases where there is some area of specialism, be it near prime, fast track or first-time buyers.
’Brokers who have found solutions outside the high street will need to be more vigilant to ensure they have considered all the suitability angles and the integrated file checking we provide will give brokers increased confidence in their recommendations.
’Secondly, lenders have a responsibility to distribute products to their target market and with greater focus by the regulator on product distribution, development and design, having cases presented to them which have been independently verified will improve quality and in the longer term lead to a reduction in product risks and less consumer detriment.”
Terry Young, managing director of Compliance Checking, says: “The FSA has made it quite clear that it was to become more intrusive in its approach and the recent discussion paper on product intervention, on top of the MMR proposals clearly show its direction.
“Greater scrutiny of lenders product design, development and distribution will become a feature of the market with suitability of advice a key area of focus. It is no coincidence that networks and larger firms have responded by increasing their suitability and file checking activities since last year. Our joint service provides Lenders and Advisers with the confidence that business through SMS will meet the product suitability requirements and is available free of charge to hard pressed advisers at this time.”