FCA: Lenders less prepared for MMR than advisers

Lenders and execution-only brokers are lagging behind intermediaries in preparation for the Mortgage Market Review, the Financial Conduct Authority has found.

In responses to an online readiness survey published in May to 5,400 firms across the country, the FCA found that overall two-thirds of firms are on track to meet the Mortgage Market Review requirements by the deadline.

Of the one-third that is not on track, the FCA said it can still get back on track by drawing up an action plan, which it will help firms produce.

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Lenders were found to be less prepared than intermediaries.

However, the FCA acknowledged lenders have more to do due to their size and complexity.

Also, the regulator found that firms planning to conduct execution-only business were generally behind with their preparation. For firms which arrange mainstream mortgages, preparation for transacting execution-only sales is where they are least prepared.

Intermediaries tended to request more information on disclosure, execution-only and evidencing suitability.

Action plans should:

• include key actions required;

• specify who is responsible for the actions;

• record key dates including a target completion date; and

• how any implementation risks will be mitigated.