The Financial Services Authority says regulation has helped consumers shop around.
It also says consumers who receive key facts documents can understand the risks and features of the mortgages they take out.
These are among the findings from the first stage of a review by the Financial Services Authority into the effectiveness of its mortgage regime which was introduced nearly two years ago.
Despite uncovering some problems, it says it has no plans to alter any rules, but it has yet to look into the effectiveness of its regulation on the sub-prime, lifetime mortgage markets and provisions for when consumer go into arrears, which will all happen next year.
FSA director of retail policy division Dan Waters says: “The review so far suggests things are moving in the right direction, although changes to consumer behaviour are likely to happen only gradually. Mortgage regulation is still relatively new and we have planned the effectiveness review in stages to identify trends and measure progress against the intended outcomes over time.
“These findings also confirm the importance of firms giving out Key Facts disclosure documents to their customers as our rules require. Well-informed consumers are essential for a competitive market, and Key Facts documents are designed to be clear, fair and not misleading and to help consumers shop around to get a good deal.”