Shift in advice rules could leave thousands worse off: Ami

The Association of Mortgage Intermediaries has cautioned the Financial Conduct Authority against changing the advice rules to facilitate execution-only sales, warning it could lead to poorer outcomes for thousands of borrowers.

In its latest quarterly economic bulletin today, the mortgage broker trade body says that it is a “misnomer” to suggest that current rules make fully-regulated online advice too difficult.

It says this argument is being used as a “convenient justification” for the need for execution-only sales.

The Association says that market intelligence suggests that £7bn of mortgages have already been originated through a fully online advice process where borrowers have the option to speak to a human adviser if they encounter difficulties.

Ami says: “The market and the regulator must be extremely careful not to misdiagnose the challenges facing this market and rush to change policy that will result in thousands of mortgage borrowers receiving a poorer outcome than they should and would under existing regulation.

“Technology is not the problem; how some firms in the market are deploying it is.”

Ami adds: “This comes back to supervision and taking the time to really understand the services available in the market, across the whole of the market; it is time to listen more broadly than just to the self-professed ‘disruptors’.”

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