The FSA's description of what will constitute a whole-of-market offering under mortgage regulation is still unclear, according to leading mortgage brokers.
In order to describe themselves as independent under statutory regulation from October next year, firms will have to be
representative of the whole of the market, which can be possible even if they have a relatively small panel of lenders.
Some brokers believe that the description of what will constitute whole of market is still woolly. Charcol senior technical manager Ray Boulger says there is some contradiction between having a panel of lenders and being whole of market.
He says a small building society such as Staffordshire Railway could have a very competitive standard variable rate but, because of its size, it might not end up on the panels of some mortgage clubs.
Boulger claims that if an appointed representative of a mortgage club wanted to recommend a product from such a lender, it would take weeks to get the lender on the panel. However, an independent broker would be able to use any lender straight away.
But he thinks the FSA is unlikely to change its rules and predicts that the regulator could end up taking cases on an individual basis.
Boulger says: “What whole of market means has not been made as clear as it ought to be.”