https://www.gov.uk/government/upload...egulations.pdf
Page 13 Article 61. (Draft) Amendments to the existing;
http://www.legislation.gov.uk/uksi/2...rticle/61/made
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FCA statement;
What happens to second charge mortgages
entered into before 21 March 2016?
If a second charge mortgage was regulated under the
consumer credit regime as at 20 March 2016, it will
become a regulated mortgage contract and relevant
MCOB provisions will apply from 21 March 2016 – for
example, the rules on post-sale disclosure (MCOB 7)
and charges (MCOB 12). In addition, some Consumer
Credit Act (CCA) provisions will be retained for these
loans, including the prohibition on interest being
increased on default (section 93), the right to complete
payments ahead of time (section 94) and the right to a
rebate on early settlement (section 95)5.
The above an extract from the the attached FCA document which, casts some doubt on what is/will happen to "unregulated" (as in "unregulated" by the CCA 1974 Act) second charge loans.
I do not see any exclusions/inclusions on secured loans/mortgages not regulated by the CCA 1974 in the draft regulations (amendments) listed above which, gives rise to question what exactly is meant by, "consumer credit regime" in the FCA statement above.
I can only (for now) assume there must be a definition somewhere of what the "Treasury" considers to be a, second charge back book loan that "is" to be regulated by the new rules as per first charge loans/mortgages. I have not yet been able to find any such "definition" which accurately describes all the loans/mortgages that fall within the description of "second charge"
As I understand it, it is for, the Regulated Activities Order 61 to be amended to, include second charge loans/mortgages as regulated mortgages. The MCOB rules will pretty much remain the same.
What am I missing here ?
Page 13 Article 61. (Draft) Amendments to the existing;
http://www.legislation.gov.uk/uksi/2...rticle/61/made
---------------------------------------
FCA statement;
What happens to second charge mortgages
entered into before 21 March 2016?
If a second charge mortgage was regulated under the
consumer credit regime as at 20 March 2016, it will
become a regulated mortgage contract and relevant
MCOB provisions will apply from 21 March 2016 – for
example, the rules on post-sale disclosure (MCOB 7)
and charges (MCOB 12). In addition, some Consumer
Credit Act (CCA) provisions will be retained for these
loans, including the prohibition on interest being
increased on default (section 93), the right to complete
payments ahead of time (section 94) and the right to a
rebate on early settlement (section 95)5.
The above an extract from the the attached FCA document which, casts some doubt on what is/will happen to "unregulated" (as in "unregulated" by the CCA 1974 Act) second charge loans.
I do not see any exclusions/inclusions on secured loans/mortgages not regulated by the CCA 1974 in the draft regulations (amendments) listed above which, gives rise to question what exactly is meant by, "consumer credit regime" in the FCA statement above.
I can only (for now) assume there must be a definition somewhere of what the "Treasury" considers to be a, second charge back book loan that "is" to be regulated by the new rules as per first charge loans/mortgages. I have not yet been able to find any such "definition" which accurately describes all the loans/mortgages that fall within the description of "second charge"
As I understand it, it is for, the Regulated Activities Order 61 to be amended to, include second charge loans/mortgages as regulated mortgages. The MCOB rules will pretty much remain the same.
What am I missing here ?
Comment