moneysupermarket.com respond to the FSA mortgage review

Commenting on the FSA's announcement of the second stage of its review of the effectiveness of its mortgage regime, Louise Cuming, head of mortgages at moneysupermarket.com said:

"I whole-heartedly agree with the FSA's decision to focus on areas where consumer detriment may be higher, such as sub-prime or life-time mortgages.

These borrowers could be considered the most vulnerable in the mortgage market and so I welcome any move to ensure they are treated fairly.

"The fact is, intermediaries recommending sub-prime or lifetime mortgages benefit from greater fees and it is imperative that we can prove appropriate advice is given and that there is no bias because of higher earning potential for the intermediary.

With this higher fee structure in place can we safely assume people are always matched appropriately to the right product for their needs? This is potentially an area that could muddy the name of our industry if not approached in a completely transparent and fair manner.

"However, there needs to be more alignment between the level of risk and the price the person pays.

While it makes sense for mortgage lenders to adopt this methodology and increase price where people are deemed higher risk, it means those least able to afford more, i.e those in financial difficulty or home owners in retirement, end up paying the higher fees.

We must ensure that the balance is fair and the industry is not preying on those with the least options.

"I await for the FSA's findings to enlighten us.".

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