The lenders all maintained that under MCOB rules they were not obliged to reveal fees paid to packager firms who remained outside of the regulatory remit of the FSA.
However, several regulated packager firms put pressure on the lenders claiming unregulated packagers would gain a competitive advantage.
Preferred Mortgages announced its decision as early as last week with Mortgages plc following behind at the beginning of this week. However both Platform and Kensington left their decisions until Thursday.
Only GMAC-RFC has said it intends to maintain its existing packager arrangement. However Jeff Knight, head of marketing services at GMAC-RFC, said: “We will be constantly reviewing the situation in the follow up to ‘Mortgage Day’.”
John Maltby, chairman of the Intermediary Mortgage Lenders Association (IMLA), said: “Our view regarding regulation is clear. If a firm performs an unregulated activity then its fees do not have to appear on the KFI. However the final choice is up to the individual lenders.”
He went on to explain that while regulated packagers felt disadvantaged over fee disclosure, lenders who relied heavily on outsourced processing could also feel disadvantaged as larger lenders did not have to declare back-office costs.
Guy Batchelor, sales and marketing director at Platform, said: “We have taken this decision so as to embrace the spirit of regulation.”
Keith Street, director of sales for Kensington Mortgages, said: “We have listened to feedback from our business partners including packagers and a significant majority have indicated they would like all fees to be detailed on the mortgage offer KFI.”
Bill Warren, network director at Complete Mortgage and Loans Service, welcomed the decision. “I am delighted that this has happened,” he said.
“We now have a totally transparent system for advisers and clients to deal with.”
David Copland, sales and marketing director at Pink, echoed Warrens views. “We have been lobbying lenders to make this change and it is great news to hear they have done it,” he said.
Sally Laker, managing director of Mortgage Intelligence, said: “I am surprised there has been such confusion over this from lenders. Ultimately regulation is about full disclosure.”
