Industry hopeful after Turner Review

The Association of Mortgage Intermediaries (AMI) promised to engage in a 'full and frank discussion' with the FSA ahead of its review of mortgage regulation in September, and chided the media that had indulged in 'needless speculation' about possible further regulation in the build up to publication of the Turner Review.

Robert Sinclair, director of AMI, commented: "The decision to take time to get the right solutions is appropriate as banks and mortgage lenders are still caught in difficult positions with most government initiatives still to be either implemented, or their impacts fully felt. This time will be used to ensure that the solutions are the most appropriate to address the real issues. We will work with our members and fellow trade bodies to ensure this happens."

Ray Boulger, senior technical manager at John Charcol, said the fact that the report had flagged up some of the negatives of pursuing such regulation was helpful.

He added: "Once the FSA consultative document has been issued in September it will up to the mortgage industry to respond robustly to convince the FSA that product regulation and mortgage caps, of either income multiple or LTV, are a thoroughly bad idea and will reduce consumer choice."

One proposal that did win partial favour was that of considering whether buy to let should fall under the FSA's remit.

Keshav Thukaram, managing director of Smartlandlord.co.uk said that to bring buy-to-let loans under the TCF rules would be welcome, as currently landlords run the risk of being treated unfairly should they fall into arrears.

He continued: "But the motivation behind the proposed regulation seems to be to penalise landlords; tightly control house price growth; and constrict the growth of the private rented sector. With very tight regulation, lenders will turn away from the sector and even fewer buy-to-let products will be available."