Although the full MMR does not come into effect until April 2014 certain aspects of it – such as helping customers who are mortgage prisoners – have already been implemented.
But brokers are concerned that some lenders have not fully informed their staff - leaving customers at the mercy of ill-informed advice.
One broker raised his concerns to Mortgage Introducer after his client - who believed herself to be a mortgage prisoner - called one lender and was told by a member of staff that they were unaware of the changes under MMR.
The client, who has asked for anonymity for fear of getting their subsequent deal rejected, contacted the lender direct to discuss moving off the standard variable rate onto a lower fixed rate after they read about help for mortgage prisoners.
The client said: “The mortgage specialist advised me of a sub 5% 2-year fix with substantial fees was the best I could get.”
Believing they were being discriminated against because they already had an interest-only mortgage the client highlighted the mortgage prisoner rule which has already come into force.
They said: "When I questioned the adviser about the rules I had read about she did not have any understanding of the changes in place under the MMR."
The client then asked to speak to a manager who also said that the changes were not in place until 2014. The client later called again and speaking to another adviser was again told that MMR changes were not in place until 2014.
Sue Anderson, head of member and external relations, said: “If a customer who is directly affected [by the transitional rules] wants to discuss a product or service which may be available to them they should be able to do so and people should be trained to enable that conversation to happen.”
However Anderson added that whether that was something that every person who is on all call to a customer needs to be able to do is a matter for individual lenders as it may be a referral issue.
She said: “We have not issued specific guidance in terms of the mechanics of how lenders should operate, that is a matter for individual lenders."
Chief executive of the Association of Mortgage Intermediaries Robert Sinclair said that the rule is to stop lenders doing anything negative to customers who are mortgage prisoners for example by increasing the standard variable rate or changing the terms and conditions of their mortgage but they do not have to offer customers alternative rates to SVR.
However Sinclair added: “The rule has deep ramifications for the whole industry and while I’m not surprised it has not reached the front end of all lenders at this stage I do hope it is being discussed within their compliance and marketing departments and steps are being taken to improve that position.”
Sinclair said these teams would be responsible for making central decisions to lending policy therefore it was important that they were fully up to speed with the rule.
Disagreement over the meaning of the rule is not confined to intermediaries and mortgage customers, lenders are also still analysing its implications.
Sinclair said: “From discussions I have had I know lenders are working hard to come to a common view but they aren’t there yet.”
