Since the announcement and joint statement by the Financial Services Authority (FSA) and the Council of Mortgage Lenders (CML) on 26January 2007, the CML seems to have stood on its head and be reneging on the agreement – seen in the CML statement in it’s 'News and Views' of 9 May,
Particular emphasis may be made by the FSA on the ‘way forward’ under
Future customers 4.6’, which states:
‘We expect lenders may wish to review their fees and standard terms and conditions in the light of their intentions for charging fees in the future, and the principles contained in this statement – including paragraphs 1.4 and 1.5. We are less likely to take action against a lender that has decided whether they will be amending their MEAF terms and MEAF amounts for future customers – and if so how – by 31July 2007 and has applied those amended terms and amounts, if applicable, from then.’
Paragraph 1.4 is particularly relevant, and says
‘If a term in a standard form consumer contract is fair under the regulations – refers to Unfair Terms in Consumer Contracts Regulations 1999 – then it is clear that a firm must act in accordance with the term, otherwise it will be in breach of a contract. If a firm acts in breach of contract, this may also involve a breach of principle six of our Principles for Business, which underpins the work we are doing with firms as part of our ‘Treating Customers Fairly’ initiative when it ought to know it was unfair.’
So should the press be bringing this issue to the fore again and be putting pressure on the CML and lenders to treat their customers fairly?
Danny Lovey
The Mortgage Practitioner
