The Financial Services Authority (FSA) is the mortgage market regulator, and as such, when you pass your CeMAP exam and become a qualified mortgage advisor, you should be aware of the FSA regulations.
The FSA recently announced that it is to launch an investigation into the way that lenders handle arrears on borrower’s mortgages and loans.
When you do your CeMAP course, you will learn about the FSA’s Treating Customers Fairly principle. Their investigation is to ensure that with the effects of the current credit crunch, borrowers should still be treated fairly if they are struggling with their monthly repayments.
In response to this announcement, the Council of Mortgage Lenders (CML) has said that it will provide guidance notes to all its members to ensure that the lenders have assistance in working in accordance with the Treating Customers Fairly principle. Part of the principle includes making sure that repossession is avoided wherever possible where there is another reasonable alternative.
Lenders will review their existing arrears procedures, make suggested changes and provide information to borrowers making sure they have an understanding of how they can avoid getting into difficulties. Arrears cases should only go to court where absolutely necessary.
For example, one change that was suggested was to give borrowers additional notice of when their initial cheap rate will expire. Some CeMAP courses give additional tips throughout the course about how to best look after your customers and one suggestion is to keep a record of those customers for whom you arranged their mortgage and to contact them again in plenty of time when you know their introductory mortgage deal will expire.
The plans are only a guideline at the moment and so some lenders may not sign up to it. The Liberal Democrats have called for the guidelines to be made law.
If you are considering becoming a mortgage advisor, now is a great time as mortgage advisor services are in huge demand. To become a mortgage advisor, the first step is to take your CeMAP exam and a CeMAP course is the quickest way to learn the basic and to pass the CeMAP exams. After the exam is when the real learning takes place.