Caffrey said: “I believe we will start to see a number of packagers who said they never intended to be regulated doing a sharp u-turn as they realise lenders will not do business with them. We always planned to apply for Principal status from the FSA, though we have decided against setting up a network.”
FSA-granted Arranger status allows a firm to comment and discuss a case with a customer, but arrangers are not authorised to give advice.
Adele Belton, head of compliance at Merseyside-based packager Advantage Finance Group which has applied for Arranger status, agreed with Caffrey. Belton said: “We believe that all aspects of the mortgage market will eventually be regulated. By opting for Arranger status we can offer enhanced services to lenders.”
However, Chester-based pure packager and branded lender em-financial reasserted the firm still planned to retain its pure packager status.
Head of marketing, Stuart Brumhill, said: “If packagers were to be regulated, we feel confident that we would have no difficulty in meeting the requirements. We already have a firm of solicitors who carry out due diligence inspections for us.”
But Peter Beaumont, sales and marketing director for all-status lender Mortgages plc, said: “We are having to draft new agreements with our packagers, and will have to audit them to ensure they have no contact with customers. It all adds to ever-increasing costs for the lender."
John Maltby, chief executive of specialist lender Kensington and chairman of the Intermediary Mortgages Lenders Association (IMLA), has called for a code of conduct to be set up for pure packagers, even if regulation comes into force.
“Packagers seeking to add extra value to their services will have to look at regulation,” he said.
