There has been much talk of late about the new mortgage regulations which were introduced by the FSA last year but what does this mean to you as a consumer? Will these regulations affect you and are the individual areas within the UK, such as Dorset, affected in different ways?
The FSA (Financial Services Authority) introduced regulations within the mortgage business on the 31st of October 2004. This means that every mortgage lender you deal with today should be FSA registered and should comply with the FSA regulations. As a result this means that all the advice you receive from a professional mortgage adviser should be honest and within your best interests. This is a tremendous benefit to you as a consumer as it means that you can be sure that the advice being given to you is upfront and you should no longer have to try to second guess any hidden loopholes.
The main regulations introduced are as follows:
- The advice given to you should be clear and accessible
- You must be provided with an Initial Disclosure Document (IDD) which outlines the type of service which they provide and also with a Key Facts Illustration (KFI) which explains the different suggested mortgages in terms of charges and risk factors.
- The KFI should follow the standardized format in order to make it easier for you to compare different mortgages
- The mortgage contract, in particular the pricing information, must be outlined in a clear manner so that you can understand it and there should be no hidden charges, tie-ins or penalties http://www.fsa.gov.uk/