The Council of Mortgage Lenders released a statement yesterday suggesting that responsibility for financial decisions is being shifted further and further from the consumer and more onto lenders, which are responsible for affordability, and now brokers, who will be responsible for assessing appropriateness.
David Geale, acting sector leader for retail intermediaries and mortgages, refused to comment on whether he thought the appropriateness test encouraged consumers to rely on brokers to make their mortgage choice for them.
He said: “Our intention overall is to enhance the mortgage process, making sure every mortgage sold is appropriate for the consumer’s needs and circumstances, even where the mortgage is being sold in a non-advised process.
“We’re focused on making sure consumers end up with the right mortgage and we think it is perfectly sensible to have that sort of test across advised and non-advised sales.”
But CML director general, Michael Coogan, said:: “The big theme running through the mortgage market review, reflected again in this latest consultation paper, is a shift in the balance of responsibility away from the consumer.
“We will need to assess carefully whether there is a risk that, in following this path, the FSA embeds a culture of consumer apathy in the mortgage market, where someone else will always to be available to blame for the consumer's financial decision if it goes wrong.
"While we fully accept lenders' responsibilities to assess affordability in a realistic and practical way, we think there is a big question mark about whether this is the right route to take if we want to achieve financial capability and responsible borrowing by consumers."
