Mis-sold Mortgage Claims > Mortgage News
Offset mortgages under the FSA spotlight
Tue, 25 Jan 2011
The latest discussion paper released by the Financial Services Authority (FSA) which refers to "product intervention" has highlighted mortgage products which are bundled with other products. These include offset mortgages which have been popular for a number of years with both borrowers and mortgage intermediaries .

The FSA has published its discussion paper on how they can meet their objective of consumer protection and more specifically the issue of "product intervention." In this it says that offset mortgages can confuse a consumer’s ability to understand the suitability of such products. These products may have a savings or bank account as part of the bundle.

Mortgages with additional or bundled products, often have headline rates for the mortgage which many experts believe distract the borrowers from the true cost or value of the mortgage they are buying. The future restriction for the sale of such products may also include the banning of these to specific groups of customers.

Offset mortgages were popular with intermediaries when introduced to the market by Intelligent Finance in 2000. Generous procuration fees were paid to mortgage brokers who sold them. What was evident during this period was the necessity to explain these mortgages to borrowers, however, many were sold direct by the lender and customers were not offered the choice of other products.
add to favouritesnewsletterlink to this pagesend to friendpost comments

Link to this page

Copy and Paste the following HTML into your page.