Mortage firms which have failed to meet the FSA's deadline on Treating Customers Fairly (TCF) should expect a visit from the regulator by the end of June.
Speaking at the Mortgage Expo in Manchester, Mandy Spink, head of mortgages and credit unions at the FSA, says the regulator will focus on companies it deemed “particularly poor” in its recent TCF implementation results.
Small firms in general came out poorly following the end-of-March results, with only 41% meeting the FSA’s deadline. However, small mortgage firms performed particularly badly, with only 22% of firms making the cut.
Spink says: “We were a bit concerned about the slow progress of the small retail firms and particularly the small mortgage firms. Only 22% met the deadline, compared with 45% of general insurance firms and 52% of financial adviser firms."
"We will be targeting the firms that we see as presenting the greatest risk to us. We will be visiting every firm that we deemed “particularly poor” by the end of June.”
Spink also says the FSA will be turning its attention to the sub-prime, self-certified and affordability areas of the mortgage market over the next year. She says early results of reviews in all three aspects of the industry show improvements need to be made.
However, Spink adds advisers and lenders now have an opportunity to “engage” with the FSA to help the industry move forward.
“We will be focusing on the areas of sub-prime, self-cert and affordability in 2007/8,” she says. “Where sub-prime is concerned, we will soon be starting the second phase of our mortgage effectiveness review, where will be focusing particularly on firms’ treatment of customers in arrears."
"On affordability, following our mortgage quality of advice survey, we would especially like lenders and advisers to apply the appropriate checks to make sure consumers can afford their mortgages.”
She adds: “This is an excellent opportunity for firms to fully engage with us so together we can raise standards across the mortgage sector.”If you have any comments you would like to add to this story or would like to speak to its author about a similar subject, telephone Scott Sinclair on 020 7034 2636 or email [email protected]IFAonline
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