For small IFA firms that do not hold client money the increase in fees is 12 per cent “which is way above inflation,” said Chris Cummings, director of AMI.
But there is a 50 per cent reduction in regulatory fees for second-line of business, i.e. firms that specialise in mortgages but also do general insurance.
At the time of going to press, the FSA’s annual fees for mortgage intermediaries had not been announced but Cummings said: “The fees initially stood at £1,200 but we managed to get this down to £700. We expect this reduction to stand.”
Compensation scheme fees are minimal according to Cummings. A total of £50 per authorised firm per year will be payable plus £50 per firm per year for general insurance. Each firm will get two free cases.
The FSA’s budgeted costs for mortgages stands at £38.6 million, compared to the Mortgage Code Compliance Board’s (MCCB) £5 million.
Richard Fox, chief executive of the Society of Mortgage Professional and former compliance director at MCCB, commented: “The trade associations need to look closely at the costs and question the FSA on the value to the consumer ”
