IMLA: MMR risks affordability confusion

In its response to the Financial Services Authority’s consultation paper on Distribution and Disclosure IMLA said while it broadly supports the proposals more clarity is needed on affordability and appropriateness.

Peter Williams, IMLA executive director, said: “We are in agreement with many of the proposals set out in CP10/28 but to avoid confusion and uncertainty there is scope for discussion to ensure clarity about what precisely is expected from the relevant parties. We need to see and discuss a fully integrated set of policy and rules drawn from across the different CPs before this is fully finalised.”

Williams says there are a number of areas where there is potential to further streamline, clarify and finesse proposals. These include the single sales standard, affordability and appropriateness, rolling up fees and service disclosure.

He said: “Our biggest concerns are around affordability, appropriateness and best interests. These issues stand at the heart of the intermediary mortgage market and it is essential the FSA works with industry to secure effective outcomes. We need to ensure policy and rules are aligned and there is real clarity as to outcomes sought, roles taken and processes used.”