FCA has launched a market study on whether competition in the mortgage sector is working in the interests of borrowers. The purpose of the study is to help the FCA understand whether consumers have enough information to choose products and services, and if they are in a position to understand whether these represent good value for money.
The market study will explore two questions, to get information on both demand and supply issues. It focuses on first charge residential mortgages, but the FCA will take note of information received on other mortgage products:
- At each stage of the consumer journey, do the available tools (including advice, price comparison websites and online calculators) help mortgage consumers make effective decisions?
- Do commercial arrangements between lenders, brokers and other players lead to conflicts of interest or misaligned incentives to the detriment of consumers?
In addition, the FCA will be looking at whether there are opportunities for better technological solutions to any problems identified, including greater use of digital channels to deliver information or advice.
The FCA will be engaging a wide range of market participants in its study although the focus will be on residential mortgages.
Comments on the study are to submitted to the FCA by 12 January 2017. The FCA aims to publish an interim report in summer 2017, with the final report due in early 2018.