“While we fully support the goal of protecting the UK economy against another cycle of boom and bust, the Bank must think very carefully before bringing its new powers of direction to bear on the mortgage market – particularly in the short term.
“Recent changes to mortgage regulations have significantly reshaped the market and the full impacts on consumers are still emerging in the wake of April’s MMR implementation and October’s FPC actions. There is every possibility of the pendulum swinging too far unless the market has time to fully take these on board. IMLA, like the CML, questioned whether the Bank needed the powers of direction it has now been granted instead of its previous power of recommendation.
“The recent slowing of house price growth is an encouraging sign that the Bank may not need to deploy these extra powers to guard against financial risks. With further regulatory changes coming down the line from Europe, we must avoid a situation where the host of checks and balances now in place fundamentally reshapes the mortgage market and in so doing chokes off people’s legitimate aspirations to own a home when they can clearly afford a mortgage to do so. The announcement puts the Bank firmly in the firing line and it must use its new powers extremely prudently.”
For further information please contact:
Andy Lane / Will Muir, The Wriglesworth Consultancy
Tel: 0207 427 1422 / 29 / Email: email@example.com
Notes to Editors
The Intermediary Mortgage Lenders Association (IMLA) is the trade association that represents mortgage lenders who lend to UK consumers and businesses via the broker channel. Its membership of 41 banks, building societies and specialist lenders include 16 of the 20 largest UK mortgage lenders (measured by gross lending) and account for about 90% of mortgage lending (89.4% of balances and 90.6% of gross lending).