The Financial Services Authority said after listening to the industry that it would “blur the distinction” between the role of the intermediary and the role of the lender if brokers had any responsibility on affordability.
Instead the FSA is proposing brokers should ensure clients meet lender criteria.
The FSA paper said: “Respondents agreed that intermediaries would continue to obtain affordability information regardless of whether our rules explicitly required them to.
“Firms agreed that we should avoid blurring the distinction between the role of the intermediary and the role of the lender in assessing affordability.
“So, we propose to remove the existing prescriptive rules about assessing affordability that currently apply to intermediaries and instead rely on a general requirement for intermediaries to ensure that the consumer meets the lender’s known eligibility criteria.”
Grenville Turner, chief executive of Countrywide, said: “One of the most positive changes is that these proposed measures provide the much-needed clarification on the grey area surrounding where responsibility for measuring affordability ultimately lies.
“The lender assuming responsibility for ensuring the affordability of the loan removes any confusion, providing clear and adequate protection for consumers.”
