FCA study suggests non-advised customers knew what they were doing before MMR
Customers who shunned mortgage advice before the Mortgage Market Review launched in 2014 generally had enough financial expertise to choose a product themselves, the Financial Conduct Authority found.
The Mortgages Market Study found there was “no significant change” in consumer outcomes between those who took out a mortgage without advice before the Mortgage Market Review came into force and those that received advice afterwards.
Rob Gill, managing director of Altura Mortgage Finance, said: “The findings that consumers who bought a mortgage without advice pre-MMR experienced no significant change in outcomes was very interesting, and probably not what many in the industry expected.
“This might upset brokers who see their roles as advisers very important to client outcomes.”
The regulator investigated the impact of advice on the likelihood of consumers falling into arrears, needing forbearance or triggering an early repayment charge.
Since the MMR rules came into force 97% of new sales have been advised, up from 70% before.