Expo: Lender communication 'vital'

Gordon Hunt, former compliance officer at the Mortgage Code Compliance Board and SPML said: “Lenders need to give clear guidance on self-certification products through their packagers and business development managers.”

Hunt believes relying on basic product guides is not enough. He said: “If brokers do not understand a product then perhaps they should not be distributing it.”

Hunt urged brokers to demand better case scenarios from lenders to help them understand exactly how their self-certification products should be used and that they were upfront and forthcoming with providers over the method and frequency of communication they needed.

In an increasingly strict regulatory environment Hunt said there was an obligation on lenders to ensure they were communicating effectively and said: “There is a range of brokers with different levels of knowledge and experience. Lenders need to make it clear what they are offering and to whom.”

Hunt also said that greater regulatory pressure in the self-certification market was likely to make life more difficult for brokers as lenders sought to heighten the way they monitored their books of business in this area.

He concluded: “There will be an increase in the amount of sampling that lenders do and they have already told the FSA they will do it. When this happens it creates problems.”