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FSA loan rules cost IFAs twice as much as lenders

The FSA has admitted that its new mortgage requirements will cost IFAs

more than twice as much as lenders despite the decision not to regulate

advice.

Speaking at last week&#39s Council of Mortgage Lenders&#39 conference in

Birming-ham, FSA head of mortgage regulation Sarah Wil-son said the

regulator&#39s pre-sale disclosure req-uirements will cost IFAs almost

£19 for every mortgage arranged.

But she confirmed that the disclosure regulation will only cost lenders –

which will be regulated directly – less than £9 for every loan

advanced.

The news has come as a double blow for IFAs following the publication of

the FSA&#39s draft mortgage rules which shocked the industry by pressing ahead

with proposals for lenders to monitor the disclosure of intermediaries.

Mortgage Code Compli-ance Board chief executive Luke March says the FSA

has got it wrong by stinging IFAs for regulatory costs when only lenders

will be regulated.

Charcol believes the rules will hit smaller brokers the hardest as

econ-omies of scale will mean they incur disproportionately high costs

which could see them forced out of the market.

Mortgageforce managing director Rob Clifford says: “These are serious

figures the FSA is proposing. Yet again, brokers will be forced to pick up

the tab as a result of regulation.”

DOCE:

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