View more on these topics

‘Fast-track would have developed into self-cert’

The FSA says fast-track mortgages would have become “self-cert by another name” if the process was retained under the mortgage market review.

The MMR proposals stipulate that proof of income will be required on all mortgages, effectively banning self-cert and fast-track. Self-cert mortgages have largely been withdrawn from the market as lenders have tightened their affordability rules in the wake of the credit crunch, meaning that fast-track mortgages will be most affected by the MMR.

Speaking at the Building Societies Association annual mortgage seminar last week, FSA mortgage policy manager Lynda Blackwell said the regulator is right not to allow lenders to offer the service.

Blackwell said: “We are well aware that lenders’ fast-tracking processes can be ’gamed’ by brokers who know the rules and who know where to place cases when they do not want to provide evidence of income. With the demise of self-cert, the point of least resistance becomes fasttrack which would develop into self-cert by another name.”

Blackwell added that non-income-verified fast-track mortgages accounted for 43 per cent of all mortgages sold in the first quarter this year.

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment

    Close

    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm

    Email: customerservices@moneymarketing.com