A study revealed lenders had made good progress in taking steps to improve the quality of Initial Disclosure Documents (IDDs) and Key Facts Illustrations (KFIs).
However, the report went on to show over a quarter of KFIs reviewed, issued by small and medium sized intermediaries and small lenders, contained errors relating to fees and charges. It also showed over 50 per cent of the intermediary IDDs reviewed also contained five or more errors.
Despite an improvement from last years findings, of 80 per cent, Clive Briault, FSA managing director of retail business, admitted more needed to be done to improve this area. He said: “Providing consumers with clear and relevant information is a key element in consumer protection because it enables them to make informed decisions and to shop around. But this review and other areas of our work have found that some firms are still not doing enough to meet our disclosure standards. We will continue to press for these standards to be met, by following up shortcomings with individual firms and by working with the industry.”
Paul Hearnden, managing director at My Mortgage Direct said he would like to see the breakdown of the figures. “It will be interesting to see how much the mistakes and errors actually relate to the client and the offer. If it is just a spelling mistake then this is likely to have little impact on the offer, but will still be classed as an error by the FSA.
“With regards to IDDs, it could be that what is happening is that people are still running on slightly outdated guidance, which is leading to the errors.”
The FSA has confirmed it will continue its study to check KFI documentation and will work with firms to help remedy any identified problems.
