Commenting on the problem, Peter Beaumont, sales & marketing director at Mortgages plc, said: “All packagers and lenders have to work with MCCB-registered mortgage introducers but identifying who is qualified to do what looks like being a near impossible task. The MCCB is implementing a compliance checking drive in the New Year with the purpose of identifying firms and their advisers that have not qualified to give full advice. However, this will be a time-consuming process and won’t give results from ‘day one’, so lenders will be left in the dark.”
The MCCB has said that responsibility lies with the individual firms themselves, but suggests that lenders should remind their business sources of the requirements for giving appropriate levels of advice in line with their qualified status and to alert the MCCB to any suspicious cases. While this self policing should be applauded as a positive step forward and one that the industry should embrace, it still doesn’t get to the heart of the issue and does little to ease lenders’ concerns that they could find themselves dealing with introducers acting outside of their realm.
Peter Beaumont continued: “The current dilemma for lenders is whether to accept applications that may have involved the provision of advice from introducers who are not suitably qualified. The aim of mortgage regulation, voluntary or statutory, is to ensure the customer has been given transparent and informed advice. The New Year, unfortunately, presents a window where this aim may be seriously undermined with non-qualified introducers moving in bulk to giving ‘information only’. The long running debate of when ‘information only’ becomes ‘advice’ can only be further exacerbated by this looming deadline.”