FSA rules state that these type of credit promotions cannot be made to a client unless there is an established existing customer relationship with the firm, and the client expects to receive contact from the broker to discuss mortgages of that relationship.
An unsolicited real time qualifying credit promotion is any personal contact with a client which is not expressly initiated or requested by the client, during which a broker offers to provide mortgage advice or services.
Intermediaries are still able to write to existing clients but any uninvited telephone call or personal visit to an existing client in order to promote services will contravene regulation.
Mark Howell, marketing manager at Pink Home Loans, said: “We are re-iterating what we see as a vital point. We are concerned that intermediaries could unwittingly break FSA rules.”
To comply with the new rules clients need to positively agree to being called periodically to review their mortgage arrangements and, in particular, when nearing the end of any mortgage incentive period.
Frank Thurlby, head of compliance at Genesis Home Loans, said: “Over the last month we have been sending out a template for a letter getting express consent. Brokers may have become accustomed to working a certain way, it’s a case of having to keep banging away to re-iterate the FSA’s regulatory message.”
James Cotton, mortgage specialist at London & Country, said: “This is an interesting area that needs clarification to avoid confusion. It is vital that brokers don’t fall foul of rulings like this which could sneak under the net.”
