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&#39Catmark&#39 could clear up flexible mortgage confusion

The Government and the CML are to discuss the creation of a Catmark-style benchmark for flexible mortgages, in response to issues raised by Sun Bank.

Sun Bank wrote to the Council of Mortgage Lenders expressing its fears that many so-called flexible loans fail to live up to their claims. It has called for the CML to scrutinise these loans and set up new industry standards.

As a result, flexible mortgages may soon carry a stamp of approval, similar to Catmarks, setting an instantly recognis-able industry standard.

The CML says it is working with the Government to produce a report on the flexible mortgage market which will be available next summer.

The first stage of the review will look at how the flexible mortgage market operates. It will then address issues such as identifying what constitutes a flexible mortgage and whether the products should be marked.

The CML says it has an “open mind” about whether flexible mortgages should be stamped with an industry mark. But says its research has the support of a Government which is eager to introduce Catmarks.

CML director general Michael Coogan says: “We are undertaking research into flexible mortgages and are supported by the Governmentin this venture. We will be addressing the issues raised, such as whether it is nec-essary to have an industry stamp such as Catmarks on flexible mortgages.

“We will also be seeingif the Government is interested in promoting this in the way it has with Catmarks.”

Sun Bank director Chris Cummings says: “Ideally, we would like to see an industry minimum standard set for flexible mortgages and forthe products to be marked.

“Marking the products would mean that IFAs could sell flexible mortgages with confidence.”

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