The Council of Mortgage Lenders is pleased the FSA has concluded that lenders have been improving their operation of self-certified mortgages. But the CML also recognises that lenders need to work further with brokers to further improve the ways in which self-certified mortgages are sold.
As the FSA recognises, lenders have been making significant efforts to ensure that self-certification mortgages are sold appropriately, and the risk of fraud and over-commitment is minimised.
The findings among brokers were more mixed, but largely related to poor record-keeping and evidence of why a self-certified mortgage was recommended or sold. The CML will be making efforts to work with lenders and brokers to identify where the industry can make further improvements.
Commenting on the findings, CML director-general, Michael Coogan, said: "The FSA has recognised the lending industry's commitment to ensuring that self-certified mortgages are sold in a responsible way to those for whom they are appropriate. This is good news, as self-certification is a big help to many people who do not fit traditional lending criteria.
"But we need to work with brokers to ensure that good practice becomes ever more widespread, and to minimise the potential for misuse of self-certification."
