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Consumer Panel calls for FSA to regulate second charge mortgages

Financial Services Consumer Panel chairman Adam Phillips today called for the FSA to take over second charge mortgages from the Office of Fair Trading.

Speaking at the FSA annual public meeting this morning Phillips said the regulator should also take control of unsecured lending, but must retain the protections and provisions offered by the OFT in these areas.

Speaking to Money Marketing on Monday, Phillips said the Consumer Panel is not in favour of maximum loan to value limits on mortgages.

He says: “We’ve got a situation where people who have got negative equity need to remortgage. There are going to be people who need more than 100 per cent mortgages and it’s a very blunt instrument to limit maximum loan to value.”

Phillips is also calling for clear guidance from the FSA on arrears and repossessions as part of its mortgage conduct of business review.

He says: “We would like to see either rules or strong guidance given by the FSA for first charge mortgages that reflect the rules about arrears and repossession that you get with the consumer credit act for second charge mortgages.”

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