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FSA visiting lenders in probe on packagers

The FSA is visiting mortgage lenders to discuss the role of packagers in a regulated environment.

Following a meeting with the Professional Mortgage Packagers’ Association’s top 10 lenders in January, the association says lenders have been getting or are expecting visits from the regulator.

Lenders which are understood to have already been visited by the FSA include The Mortgage Business and Platform.

The term packagers is currently used to describe a range of intermediaries and their different activities in the mortgage process. The role of packagers has come under scrutiny recently by some lenders, including BM Solutions and Mortgages plc, which say that packagers must be able to show their value within the mortgage process.

The FSA says it wants a better understanding of the often complex issues brought up within a lender/packager relationship.

Zebra Home Loans director Paul Fletcher says: “It is difficult when there is a regulated lender, a regulated broker and, in the middle, an unregulated packager. It does not sit right. We would welcome regulation and I would expect some sort of sub-form of FSA regulation purely for packagers.”

PMPA director Vic Jannels says: “We applaud the FSA looking carefully at all aspects of the market and particularly the role that packagers play. In our view, packaging should be part of the regulatory process.”

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