MMR changes may be enforced before European vote

MMR changes may be enforced before European vote


A “crucial” vote on a directive which could shape the future of the UK mortgage market has been delayed for three months. 

Originally scheduled to take place on 10 September, MEPs were due to vote on the European Directive on Credit Agreements Relating to Residential Property (CARRP) - which aims to produce a sustainable European mortgage market – however, an updated timetable states that the date for a plenary sitting is now planned for 10 December. 

According to the FSA, the proposed legislation will affect “anyone involved in the UK mortgage market … whether a consumer, a mortgage intermediary, a mortgage lender or a firm involved in mortgage funding.”

As a result of the delay, any outcomes of the vote on the proposed Directive -known commonly as the Mortgage Credit Directive (MCD) - could take place after the FSA has published its final Mortgage Market Review policy statement and rules. 

It is therefore uncertain when UK and European mortgage regulation will be amalgamated. 

The European Commission’s motivation for Directive, according to the FSA, was: “…the lack of integration across national markets and the fact that the full range of mortgage products is not available in each member state. Therefore, consumers in some member states may face a reduced choice of products or even be excluded from their national mortgage market altogether. Recent events in the financial markets are also driving a reform agenda, through which the Commission is now looking to reinforce protection for investors and consumers.”

In a statement following the news, the Council of Mortgage Lenders (CML) said: “On behalf of lenders, we are continuing to work with the FSA in the UK and the authorities in Europe for a regulatory structure that meets the needs of the domestic mortgage market and results in a coherent set of proposals.”


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