Back in May, I presented the findings of a FCA probe, CBeebies style, for your consideration.
Reading the latest discussion paper on whether mortgage lenders who change their terms are acting fairly, Michael Rosen’s picture book ‘We’re going on a bear hunt’, sprang to my mind.
Surely anyone who has enjoyed ‘We’re going on a bear hunt’ will have quickly figured out that despite regular protestations that “We’re not scared” about hunting bears, the family the story follows are fooling no-one but themselves.
The family in the picture book favourite of CBeebies viewers are intimidated at the thought of going through “long wavy grass”.
Clearly this family will fail to cope with an encounter with a big bad bear.
Their claims they are hunting one and are not scared about doing so are clearly ridiculous.
The FCA’s latest discussion paper starts with the City watchdog saying “Lenders can change their regulated mortgage contracts after the point of sale without treating their customers unfairly.
“However, there can be fairness issues if, for example, the lender misled the consumer about the likely operation of a mortgage during its term.”
At the start of reading this latest discussion papers your hopes are high that they are going to catch naughty lenders - all you mortgage advisers know who these big names are - and at the very least slap them on their wrists.
But as the paper drags on this strong stance start dwindles off until you eventually realise all the FCA wants is for comments from borrowers who have seen their mortgage terms changed.
Now, come on FCA.
When you replaced the FSA you promised no more Mr Weak Regulator and that you would be men of action.
Why have you brought out a discussion paper on this subject?
The evidence is clearly and readily available that some lenders have not treated their customers fairly by tinkering with the terms of their home loans.
It is time for a little less conversation and a little more action please.
How can changing terms to trap borrowers or hiking rates because your shareholders want a better return be fair?
If you really are not scared of big high street lenders, why don’t you just come out and say: “Changing mortgage terms so that borrowers are trapped with a lender is wrong. If we catch you doing this, there will be trouble”.
