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&#39Make Cat compulsory on loans&#39

Nationwide Building Society is calling for the Government to make Cat standards compulsory for mortgages sold to “vulnerable” buyers or without advice, including internet sales.

Its response to the Treasury&#39s Regulating Mortgages consultation claims “the biggest help for consumers is to find a place for Cat standards”.

Nationwide, the only major lender to adopt the voluntary standard introduced in April 2000 for all its mortgages, is arguing that only Catmarked loans should be sold to people such as first-time buyers.

It says Cat standards should be applied for execution-only sales because they tackle problems such as redemption penalties and hidden charges. It claims brokers would benefit from straightforward compliance and if all lenders sold Cat-standard products it would create a level playing field.

Divisional director John Sutherland says: “If Cat standards were applied across the market they would do away with problems like mortgage indemnity guarantee charges.”

Charcol senior technical manager Ray Boulger says: “Any form of product regulation like Cat standards would be seriously detrimental and restrict consumer choice.”

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