Under the changes to the Mortgage Credit Directive (MCD) if you want to describe your firm as an Independent Mortgage Intermediary after the implementation of MCD, you will need to demonstrate that you consider second charge lending as well as first charge.
A new rule, MCOB 4.4A.4R (3), states
- An MCD mortgage credit intermediary must only disclose that it is independent if its consideration of MCD regulated mortgage contracts across the market is unlimited.
MCD regulated mortgage contracts includes second charge lending.
You may already have received an MCD data collection questionnaire from the FCA or will receive one shortly. You will need to complete this using the FCA Connect system.
One of the questions will ask if you intend to ‘do second charge mortgage business.’ As stated above, to use the term ’independent’ you will need to consider second charge loans as an option. To be independent your client files will need to evidence that second charge was considered and recommended if most suitable for the client.
This applies to mortgage business only. The current independence rules for investment business remain unchanged.
FCA expectations – temporary long term absence
Richard Foster Compliance 2020, 2021, Certification, Conduct, Directory, FCA, PI, Register, Senior Manager, transfer
Following consultation in CP20/23, which was published in December 2020, the FCA has made changes to the Handbook. The affected sections are: SYSC 25.4 FIT 1.3 SUP 10A.14, 10C.9, 10C.10, 10C.11, 10C.14, 10C Annex 2G and 10C Annex 6R Form D In summary, the changes to the Handbook are intended to reflect the FCA’s […]