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CML calls for full range of advice on mortgages

The Council of Mortgage Lenders wants the FSA to ensure advisers provide

full information on all aspects of mort-gage products and not just compare

them with Cat-standard mortgages.

CML director general Michael Coogan says the FSA will have to decide on

its preferred option for mortgage advice in the coming months as it is

given the authority to regulate mortgage products.

He believes the FSA has a choice of compelling advisers to simply compare

non-Cat-standard mortgages with Cat-marked products or to reveal all the

features of a mortgage, of which the benchmark would be only one.

The CML is urging the FSA to put Catmarks into context and deal with the

benchmark as one of many product features.

Coogan says: “The issue is consumer knowledge. The full picture of

financial implications must be made available to the customer. Just saying

whether a product is Cat-friendly or not does not fulfil this

responsibility.”

Mortgage brokers may have to consult lawyers to reword their terms of

business following the Government&#39s decision to ban char ging fees for

advice on Cat-standard mortgages.

Under the conditions of the Consumer Credit Act 1974, the maximum amount

that mortgage intermediaries can charge clients if a mortgage is not

completed within six months is £5.

But under the Catmark regime, many brokers will be obliged to rework their

terms of business.

Scottish Amicable natio nal mortgage manager John Malone says: “Advisers

are going to have to make sure that their terms of business include the

fact that no charges will be made on Catmarked mortgages.”

Perspective, p24

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