The Mortgage Credit Directive will be implemented by 21^st March 2016. The Directive aims to create a union-wide mortgage credit market with a high level of consumer protection, and applies to secured credit (first and second charge loans) as well as to home loans.

A vulnerable customer is someone who, due to their personal circumstances, is especially susceptible to detriment, particularly when a firm is not acting with appropriate levels of care.  All brokers should have procedures in place to identify and deal with vulnerable customers to ensure all customers are treated fairly.

New rules for credit brokers come into force on the 2^nd January 2015.  Credit brokers will only be able to charge fees if they follow the new disclosure rules announced today by the FCA.

Most mortgage brokers only deal with a limited number of consumer credit transactions and with the application period starting for firms to apply for full permission we are getting asked “do I need authorisation for consumer credit?

The FCA willbe notifying all firms in the next couple of weeks to explain the three month period when they will be able to apply for full consumer credit permissions.  These dates will depend on the permisions you require and your frm location.  For the majority of mortgage brokers they will only need permission for credit brokering.  

You can see the dates that apply for your firm in the FCA attachement linked here

Just scroll to page 9 to see the table and find your firm type from the list.

The FCA has now confirmed that mortgage brokers will not require the CCL categories D and E for debt adjusting or debt counselling.  Previously mortgage brokers required these categories for consolidating unsecured debts on a re-mortgage.   

The change will result in a saving on the application fee as a result of not needed these higher risk categories.  At last some sensible action from the regulator!

The FCA have today released the final rules regarding the regulation and transfer of Consumer Credit from the OFT following the consultation period.  The FCA take over regulation on the 1st April 2014 and as a reminder if you have not yet applied for interim permission you must do so before the end of March.  

All consumer credit firms will need to comply with the FCA's principles for business from the 1st April. 

The FCA have announced the next regions to be assessed under their business risk workshops (BRAW), the following areas are to be assessed:

Cardiff, Llandrindod, Llanduno, Newport, Swansea, Shrewsbury, Gloucester, Hereford, Chester and Crewe.

Do you have an MMR plan in place to be compliant with the new rules, which come into force on the 26th April 2014?  We are receiving enquiries from firms requiring support to get them MMR ready, making sure they have a good understanding of the requirements and providing MMR compliant documentation, if you are still unsure on the rules and don’t have a full plan in place please read on.

The FCA delivered a presentation outlining the key points of the directive at the Financial Services Expo earlier this week.

 Due to the comprehensive regulation in place in the UK the directive will mainly affect lenders, but brokers may be forced to make additional declarations under the new rules.

The European Parliament is expected to pass the directive in a vote later this year. From that date the UK will have just over two years to comply with the new rules.