A Financial Services Authority director has warned that UK mortgage regulation could fall under European rule. According to the director, the EU believes the UK does not comply with the European Code of Conduct and wants UK mortgages to fall under the European Commission.
The FSA is currently in the process of setting up mortgage regulation in the UK. However, if Europe gets their way, UK mortgages could fall under their remit by 2006. EU mortgage regulation (together with other parts of their regulation) is very different to the proposed regime in the UK. Under EU rule, advice on mortgages would be compulsory with less disclosure of products to consumers.
The FSA have warned that EU mortgage regulation is a real possibility and that opinions between the two regulatory systems differ.