Housing minister Grant Shapps has branded the Financial Services Authority’s Mortgage Market Review paper a “step too far.”
Speaking at the National House-Building Council conference yesterday, Shapps says he would not be able to get a mortgage under the current proposals.
When asked about the MMR, Shapps told delegates: “I am absolutely clear about this. I think it was at the point when I realised that I wouldn’t have been able to get a mortgage if the MMR changes went through that I thought this might be a step too far.
“There’s no point closing the door after the horse has bolted.
“The problem with the mortgage market was not some pernickity issue with whether you get X or Y percentage or what form you get the end user to sign.
“It was because there was a lack of central regulation on the way the banks were operating and their ability to carry on operating even after they didn’t have the balance sheet to do it as Northern Rock and Royal Bank of Scotland were doing.
“What we need is top level central regulation and not pernickity down in the dirt regulation and what you can and can’t do as a mortgage company.
“I hope the FSA will be getting that message. They are independent and are free to go off and do this work but I think it is important we learn from the lessons of the past without repeating them which is what I think they are in danger of doing.”
The Council of Mortgage Lenders recently called for a political debate on the Mortgage Market Review.