FCA Deems Mortgage Advice Suitable with Room for Improvement
Last week the United Kingdom’s (UK) Financial Conduct Authority (FCA) released the findings of its review of the mortgage market, Embedding the Mortgage Market Review: Advice and Distribution. The FCA’s report was generally positive for the mortgage industry. Acting Director of FCA Supervision, Linda Woodall, said in a statement, “A mortgage is a significant undertaking for anyone. It is vital that customers are able to get suitable advice and a positive experience when deciding on their options. Some firms were able to provide this, but not all.”
The review found that “many lenders have taken significant steps to provide advice for the first time,” and there was “no evidence of system customer detriment.” Nearly 60 percent of advice given was deemed suitable according to the FCA’s criteria.
The FCA did uncover some areas for improvement. Despite noting that many lenders had improved their policies, the report suggested “those [lenders] that have always provided advice, show now focus on delivering consistently good outcomes for customers.” Finally, the review found, “Some firms were failing to take reasonable steps to obtain sufficient, relevant information about customers’ needs and circumstances before making recommendations.”
- FCA Press Release: http://www.fca.org.uk/news/fca-review-mortgage-customers-suitable-advice-scope-for-improvement