MMR: Now the real changes will be felt
Posted on February 1st 2010
The consultation phase of the MMR came to an end last week and over the next couple of months we will see the results which will allow us to start to assess the impact on the mortgage market.
Many of the potential outcomes are unlikely to have an immediate effect as many firms have already implemented change in anticipation of the outcome. For example, the effective banning of self cert loans has already been implemented by the market. However, there are some areas that potentially will have a significant impact. The approved persons regime will most likely include people who advise borrowers on regulated mortgage contracts. This means that where previously the FSA regulated the Appointed Representative they may in future regulate the Registered Individual which is an additional 15-20,000 people. That is going to be a big job and one that many are saying will have a disproportionate cost compared to the benefit.
My view is that whilst it may be a pain to start with the long term benefits are worth the effort. No doubt the registration process will flush out some people who are not fit and proper to advise borrowers and more importantly it will allow lenders to be much more accurate in targeting those whose standards are below a professional level. For the 99% of advisors who are fit and proper this will only enhance your reputation with borrowers and lenders alike. As the saying goes, ‘no pain, no gain’.
