FCA has published a consultation on the future regulatory treatment of first charge mortgages regulated by the Consumer Credit Act 1974 (CCA). FCA explains that, prior to 31 October 2004, first charge mortgages were regulated under the CCA if they fell below a certain financial threshold. Once the MCD is implemented, administration of those mortgages will be a regulated mortgage activity from 21 March 2016, and the CCA will no longer apply to them. FCA is consulting on proposed rules for firms that administer or perform activities in relation to variations of these mortgages. The proposals include:

  • applying its existing Mortgages and Home Finance: Conduct of Business (MCOB) sourcebook to these mortgages in the same way as it applies to firms in relation to post-2004 first charge mortgages, with some limited modifications or exceptions; and
  • firms performing activities in relation to pre-2004 first charge CCA mortgages will be subject to other Handbook rules applicable to firms performing activities in relation to first charge back book mortgages, for example FCA’s sourcebooks for Supervision, Dispute Resolution: Complaints and Training and Competence, with some exceptions.

Consultation closes on 18 December 2015. (Source: FCA CP15/36 – CCA Mortgages Treatment)