Which mortgage lenders will still be trading on Monday?
If a lender cannot produce compliant Key Fact Illustrations (KFIs) for a given product, then that mortgage cannot be offered.
Although reassuring noises have been made by many lenders over past weeks, the lack of 'loud and proud' statements from lenders saying “yes, we will be ready and on all of our mortgage products” has left many thinking that Monday will reveal some surprising results – if not a very newsworthy story of further mortgage market troubles.
Many commentators have said that the FSA did not allow lenders sufficient time to adopt the new rules and requirements – particularly with regard to KFIs that are a complex challenge to say the least.
The tight timescale may result in some lenders being unable to trade from Monday until they have completed the necessary preparations, or perhaps more likely that consumers will be deprived of many attractive and appropriate mortgage products for which the work has not yet been completed.
Monday's survey results are thus likely to ask some intriguing questions of both mortgage lenders' ability to adopt these demanding new rules in time — but perhaps more strikingly of the sense in the FSA's insistence on the original timescale, despite late confirmation of the details of the new regulations.
With house prices now falling across the country, repossessions rising dramatically and new lending declining day after day, will the FSA in fact be pushing the mortgage market over the precipice?