These include making income verification a requirement for all mortgages resulting in the banning of self-certification and fast-track mortgages.
Ultimate responsibility to assess affordability will now lie with the lender who will be held accountable.
More prescriptive rules on affordability checking will be implemented including the requirement for evidence of a repayment strategy for interest-only mortgages.
Also now all mortgage intermediaries will be required to be an Approved Person and must hold a mortgage qualification.
In addition the FSA has increased its proactive approach to tackling mortgage fraud through its Mortgage Fraud Strategy.
This encompasses existing activities such as enhancing its industry communications with the "Information From Lenders" scheme and improving mortgage fraud investigation methods.
New initiatives include setting up a regular Mortgage Fraud Round Table with the participation of major lenders and the Council of Mortgage Lenders and greater collaboration with external with external bodies and industry links such as the police and fraud-solution providers.
The FSA will also continue to maintain its deterrence message through enforcement action.
In June 2011, the FSA published its thematic report on the adequacy of lenders’ systems and controls against mortgage fraud.
The review found that although the industry had made some improvements, there were still weaknesses common to many firms.
This included governance and management information, underwriting, third-party management, mortgage fraud prevention, training and compliance and internal audit.
One of the key findings in the report was the importance of information sharing.
The FSA said it would encourage firms to engage with cross-industry information sharing initiatives, including HMRC’s recently launched verification scheme and its own IFL scheme.
The FSA will also continue to look at lenders’ mortgage fraud systems and controls, and firms should take note of its findings and the good and poor practice guidance contained in its report.
