Speaking from his offices at Jeffrey Green Russell, the law practice where he is a retained consultant, Mr Bloomfield revealed that executive members from the ASTL will be meeting with FSA regulators next month to discuss matters of interest to the watchdog and short term lenders.  

These issues are said to relate to the standard FSA concerns of treating customers fairly, handling borrowers in arrears, transparency of pricing and affordability of short term finance.

There is also the possibility that buy-to-let loans could become a regulated activity, with Mr Bloomfield adding that if this is the case, short term lenders who are currently not FSA-regulated may have to become regulated quickly if they wish to continue offering these loans.

“This could have a very serious effect on the industry between now and the end of the year,” he predicted. 

As Chelsea Building Society becomes the latest lender to reveal huge losses incurred from fraud within buy-to-let loans, having announced the £41 million ‘black hole’ last week, it is understood that the FSA is becoming more interested in bringing the buy-to-let market under regulatory scrutiny.

“Although we don’t know for sure, there is a strong body of opinion that buy-to-let loans may be brought into the regulatory environment.” Mr Bloomfield confirmed.

He continued: “As the majority of ASTL members are regulated by the FSA, some have been visited and examined and regulators have expressed interest in learning more and understanding better some of the things they’re doing, therefore we are pleased to maintain a dialogue with them.

“The ASTL has behaved very responsibly and in a very coordinated fashion in coming up with the trade association’s position on some of the issues of interest to the FSA – there are no conclusions to that as of yet, and the dialogue continues, which is healthy.”