The Financial Services Authority has issued a bulletin on financial promotions of mortgages, advising firms on several issues they can take into account when designing their own promotions.
The bulletin states the overarching principle for financial promotions is they should be “ clear, fair and not misleading” and how a firm seeks to meet this principle is the decision of each firm and its senior management. But, it adds that when assessing the principle, firms might wish to consider the following issues: A cash lump and/or income from an equity release scheme may reduce the consumer’s state benefits; With a roll-up mortgage, the outstanding loan including the added interest can grow very fast and if the total rises to more than the value of the property this would res...
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