The FSA found that the London-based firm failed to give sufficient prominence to the annual percentage rate in a mortgage promotion aimed at people with County Court judgments, loan arrears or defaults.
In another promotion, it failed to indicate the level of fee that customers would be charged or set out that the fee included an amount to cover other fees which were paid by the firm on the customer’s behalf.
The regulator says in addition, the firm failed to record appropriate details of customers’ needs and circumstances including how customers planned to repay the mortgage and their income and expenditure details.
The FSA says Mortgageland has amended its financial promotions and taken steps to remedy the other failings.
FSA director of enforcement Margaret Cole says: “Taking out a mortgage is one of the most important decisions anyone makes during their life. Poor practice by firms in this area poses a high risk to consumers and this is particularly the case when it comes to sub-prime mortgages, given the vulnerable nature of the target audience.
“It is essential that firms’ financial promotions are clear, fair and not misleading, so that consumers know exactly what they are buying. And poor financial promotions often go hand in hand with other problems at firms. In this case, the firm also demonstrated poor record-keeping, both in terms of assessing suitability and documenting recommendations made.”