FSA consults on regulation of Home Reversions and Islamic mortgages

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The Financial Services Authority (FSA) has set out plans for the future regulation of Home Reversion plans and Home Purchase plans also known as Islamic mortgages with the date for the introduction of regulation likely to be set for Spring 2007.

The regulation of Home Reversions follows calls from the industry that all equity release products are regulated instead of the current imbalance where only equity release plans of Lifetime Mortgages as they are defined by the regulator are monitored. The FSA’s proposals for the regulation of Islamic mortgages also seek to redress the current imbalance whereby one type of home purchase scheme acceptable under Islamic law know as a Murabaha is already regulated under the FSA’s mortgage regime while Home Purchase Plans are not. Dan Waters, director of retail policy at the FSA, says: "Regula...

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