Tesco and the Post Office are remaining silent on how they will restructure their mortgage businesses following the FSA’s decision to ban non-advised sales.
Execution-only sales will not be permitted from 26 April 2014 for the majority of borrowers, except under limitied circumstances such as contract variations and deals arranged online or via post.
Both lenders offer their products online or over the phone rather than through intermediaries, while the Post Office introduced “mortgage specialists” into five branches to offer information but not regulated advice.
Neither one is prepared to specify how they intend to meet the new regulatory requirements.
A Tesco spokesman says: “As a responsible lender we will comply with future regulatory requirements and are currently examining the detail of the new regulations.”
Post Office head of mortgages John Willcock says: “Earlier this year, we introduced mortgage specialists into a number of branches and will continue to roll out this service to other branches across the UK. We are currently reviewing the contents of the MMR and will make any appropriate changes to our service to ensure we conform with those taking place in 2014.”
London and Country head of communications David Hollingworth says: “Whilst there is the ability for the Post Office and Tesco to do some execution-only business and provision of information, as soon as they start to have a conversation about products, that would seem to fall under the advised process.
“The FSA has said it does not want people pricing their products lower online to try and push people through a non-advised process. You can still transact that way but it does not want cheaper products online to become a way of side-stepping the advised process.”