CML withholding interest-only data
Last summer the FSA raised the possibility of banning interest-only mortgages outright but subsequently said it would not propose this officially until it had consulted fully with the industry and other interested parties.
The unpublished CML research shows for the first time an aggregate picture of the health of mortgages lent on an interest-only basis in the past.
Michael Coogan, director general at the CML, said he did not plan to share this information until the FSA had made a clearer statement of intent on interest-only mortgages.
He said: “As we have said before, we don’t believe that interest-only products are detrimental to the market. But clearly there are people who have borrowed on this basis in the past who don’t have a repayment vehicle in place which may be cause for concern. It’s not a black and white issue.
“We have already completed aggregated research on interest-only mortgages as part of our reorganisation of how we collect and manage our data and statistics. We have not published and do not intend to before we know what the FSA’s policy objective on interest-only is.”
Coogan added that the CML was collaborating with the FSA on the wider Mortgage Market Review and looked forward to continuing that dialogue in 2011.
The FSA said: “Our proposals are designed to address the major failures that have occurred in the mortgage market and we are actively consulting with all stakeholders to ensure we get the right solution.
“We continue to welcome and review all feedback we receive and we have already indicated we will not rush into change without fully assessing the impact of our proposals on the mortgage market. We will continue to work with industry and consumers to establish a strong mortgage market where those who can afford mortgages are able to get them.”