The FSA says it is right to press ahead with its reform of the mortgage market despite the European Union having yet to finalise its own Europe-wide mortgage market rules.
In March, the European Commission set out draft rules for a directive on mortgage lending to standardise and improve lending and borrowing practices across member states.
Speaking at the Building Societies Association annual conference in Birmingham today, FSA director of conduct policy Sheila Nicoll said it is important European regulation does not stifle individual markets.
She said: “We all have an interest in ensuring a robust check on affordability in every case. But what we also need – and it is encouraging to see the European Commission and the Financial Stability Board recognising this – is for the beneficial diversity and effective operation of national markets to be ensured.”
She added: “We also think moves to strengthen protection in the UK market should not necessarily have to wait for EU and international changes, which could take many years.”
Also speaking at the conference, European Mortgage Federation senior legal adviser Jennifer Johnson said the EU’s rules will not achieve what they were drawn up to do.
She said: “We are concerned that the text that we have in front of us is not fit for purpose and will not actually meet the objectives it is supposed to fulfil.”