30-Aug-14
Mortgage consultation process on the Royal Bank of Scotland regulatory action failed because the new rules they can afford to absorb mortgage should be used as a warning to other institutions, brokers said.
Financial behavior Authority to provide advice in its mortgage business inappropriate Royal Bank of Scotland this week slapped with a fine of £ 14.5 m. Only two 164 sales, the city watchdog to review the bank to meet expected standards in the sales process.
David Hollingsworth, director at mortgage brokers London and Country mortgages, said: "This is as a clear warning; regulators will take action if people do not improve their programs."
Andrew Montlake, director of mortgage broker CORECO, he said, the time in 2011 and 2012 failures occurred when the borrowers are often able to take out a mortgage is not recommended as its applicability. "There is every reason to believe that other banks may be microscopic and regulators may find similar mistakes," he said.
Review of the mortgage market, which has posed a serious request in April for lenders to assess whether borrowers can afford the loan affordable, is likely to reduce the risk of recurrence of the problem of the Royal Bank of Scotland. Under the new measures, all potential borrowers through the process of monitoring and recording, forcing lenders to provide advice.
"Before you have a customer enters, when they have received advice, in fact they are willing to feel the information branch," Hollingsworth said. "Now the loans have to say - this is our proposal, which of course according to your requirements more fair competitive environment.”
Royal Bank of Scotland has been criticized for failing to recommend and correct its deficiencies record keeping, even if the regulatory agency issued a warning in 2011, the audit found errors after one year, and has not been repaired, and by the FCA revealed mystery shopping activities of sales advisor does not get the correct information customers give suggestions or comments are inappropriate will not at all, they should do so.
FCA highlight three instances in which sales personnel coming on interest rates offered to their personal opinion, its mystery shoppers, make it considers "very inappropriate" and may damage the interests of clients.
Brokers said, however, it will also be disruptive customers, if the lender to explain the FCA's decision, suggesting that they are not allowed, especially when considering the future of the benchmark interest rate part of the formation of any assessment of the burden with customers any interest rate discussions.
Hollingsworth said such discussions often buyers are provoked: "It shows a line can be difficult, because all of our customers to talk about what is going to happen when the interest rate problem, the staff go. Too far and put their personal views into reality. "
Royal Bank of Scotland said that as the problem was discovered, it has "a radical improvement in their processes," and for a period of further training to take all the consultants work.
Even in defeat mortgage advice proved to be an industry-wide problem, but after all, they are unlikely to lead to a rush on the wrong sold payment protection insurance compensation (PPI), which is set to claim the cost of the scandal, a total size of the sector £ 23 billion.
Identifying cost errors will be difficult to sell mortgages to find than compensate the producer price index, usually discrete fee added to the loan. Lenders also can choose credited their mortgages, rather than a one-time payment, hindering from claims management companies, has been profitable from the PPI remediation benefits to compensate customers.
Ray Boulger, at mortgage broker John Charcol senior technical director, said: "A claimant will have to work hard to identify any losses it's not black and white.”
|