Following the Commission’s 2005 green paper on mortgage credit in the EU, the organisation has begun dialogue with consumers and the industry on a number of key topics, including the provision of advice, the status of the European code of conduct on mortgages, and pre-contract information. The group will also discuss early repayment, with a separate group set up to look at mortgage funding.
The Commission stated that greater integration within the European mortgage market would allow for greater product innovation, an increased ability to serve non-conforming borrowers on mainstream lending margins, and would also lead to decreasing costs for home loans.
However, in its report the CML stated that the green paper held little benefit, ‘except for the internationally active lenders’. It added UK lenders could face disruption and expense through changes to the MCOB framework, which would slow down the mortgage process. The CML has confirmed it has engaged with the Commission regarding its concerns.
Rob Griffiths, associate director at the Association of Mortgage Intermediaries (AMI), urged brokers to pay attention to the European market, and said: “Clearly the work that the European Commission does in all areas has a massive impact. AMI is fully aware of the possible challenges that European legislation could have for mortgage intermediaries. AMI is active in terms of lobbying on these issues and has been since its inception.
He added: “There are two existing directives that could affect mortgage intermediaries, the Markets in Financial Instruments Directive (MiFID), and the Consumer Credit Act (CCA). AMI is working to see the potential impact of both of these on the intermediary market.”
