In its response to the Mortgage Market Review distribution and disclosure paper Peter Williams, executive chairman of IMLA says the devil is in the detail and there is a lot of detail.
He says: “IMLA welcomes this consultation paper because it brings into the open the FSA’s thinking regarding distribution and disclosure – key issues for intermediary lenders and the intermediary market as a whole.
“The main proposals concern moving to apply the same standards for advised and non-advised sales, putting full responsibility for affordability assessments on lenders while requiring sellers to undertake ‘needs and circumstances’ assessments and to be professionally qualified.
“The cost of the roll up of fees is to be made more explicit through two KFIs, but the Initial Disclosure Document is to be removed and replaced by a wider disclosure requirement that might also include an IDD.
“As always the devil is in the detail and there is a lot of it here. It is unclear whether the proposals in the consultation paper will clarify and de-clutter the sales process or make it more complex for both borrowers and sellers.
“As in the last consultation paper, we are given no real sense of the assumed capacity or role of the borrower – one of the great silences of the whole MMR process.
“Although the FSA indicates the paper is directed at ‘sellers’, in reality there is a lot in the Consultation Paper directed at lenders and not least branch-based lenders. There is a great deal at stake here and it is vital we end up with reformed system that works better for all the parties – in IMLA’s view, we have a long way to go.”