A New Set of Rules Put Forth by the FSA
Many who are at this time, at the altar of perfection and certainty are likely to lose hope as a result of the Financial Services Authority's crack down on interest-only mortgages.
Terming the whole issue as ‘inappropriate risk assessment of securitized mortgages’ the Association of Mortgage Intermediaries (Ami), made it very clear that had the watchdog conducted an appropriate analysis, it would have been different.
The Ami further stated that the outcome would have been the same answer but, would be accompanied by different solutions to those which have been put forth.
"The regulator's apparent aversion to a type of borrowing that has served many consumers very well appears predetermined rather than driven by rationale”, said Robert Sinclair, Director of Ami.
All the brokers who were ready to work for the betterment of the consumers, he added, would have all the rights to advice on the widest range of solutions.
He further said that it was unwise to come up with a regulation which would make the lenders look at interest, as a risk factor. This would make the capital required for the covering up, lose market.
These new rules that have been put forth by the FSA have made it very clear that all the mortgages which have been issued over the past five years, would not have been allowed if these rules were issued earlier.