The National Association for Mortgage Brokers and Advisers is urging all mortgage intermediaries to ...
The National Association for Mortgage Brokers and Advisers is urging all mortgage intermediaries to contribute to current regulatory consultations on depolarisation and mortgage regulation by e-mailing their views to the association.
NAMBA has created an online survey on its website and sent email surveys to its members to inform them of changing regulations regarding mortgage practices, elicit views on these changes and generally spark an industry-wide debate.
NAMBA reminds its members that although the FSA will not be taking the helm till October 2004, decisions on depolarisation which will affect mortgage intermediaries will need to be made by the end of this year and is urging its members to take action.
With the FSA taking over in October 2004, NAMBA questions whether members are aware that intermediaries will need to be directly regulated, or regulated through a principal, by the watchdog.
NAMBA warns that under this new regime intermediaries will not be able to be tied for some business and independent for others anymore.
But what does "independence in the mortgage" market really mean, asks NAMBA. "For example, if you are an appointed representative of a life office, are you independent for mortgages?" NAMBA asks its members.
When giving mortgage advice, intermediaries will be required to assess their client's affordability, but NAMBA asks for views on if this is acceptable or whether it should be a matter for the lender instead?
The implications for intermediaries bearing the burden of affordability assessments include the additional costs which may be incurred by an increase in PII cover. So can members afford this extra responsibility?
The alternative to conducting an assessment of affordability is to use filtered questions when selling a mortgage, which possesses a lower regulatory risk to intermediaries. But are NAMBA's members prepared to sacrifice giving advice?
NAMBA urges members to be aware of the changing approach for the appointed representative scheme, for example, the fact that ARs could tie for 13 different product sectors, including mortgages and general insurance.
NAMBA asks it members if they are aware, come regulation, that capital adequacy standards for mortgages will need to be met.
For third party packagers, or mortgage clubs, NAMBA warns that they may not need to be authorised by the FSA which could restrict participation in the fee payment process if the regulator follows its usual practice of requiring fees to be paid directly to an authorised firm.
In addition, NAMBA adds, any marketing and packaging allowance paid by lender to the mortgage club may then be subject to VAT.
To complete NAMBA's survey or become a member click through the website link on the right
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