Financial services

Mortgages

The Government is determined to ensure that the UK’s financial services industry supports the broader economy, and this includes having a sustainable and healthy mortgage market. We need an industry that provides essential credit and financial services to businesses and households, in addition to being an important part of the economy in its own right.

To achieve this aim, the Government believes the regulatory structure for financial services needs to be reformed. Since 2004, mortgages have been regulated by the Financial Services Authority (FSA). Under the Government’s plans to reform the UK regulatory framework, responsibility for consumer protection will transfer to a new conduct of business regulator for financial services, the Financial Conduct Authority (FCA), while responsibility for prudential regulation will transfer to the Prudential Regulation Authority (PRA).

The reforms will also establish a Financial Policy Committee (FPC) within the Bank of England to monitor and respond to systemic risks. These reforms will help ensure that consumers and the wider economy are better protected in the future.

For now, the FSA retains responsibility for mortgage regulation. It is conducting a wide-ranging examination of its regulatory framework in the Mortgage Market Review, to help determine the shape of the UK mortgage market and support responsible lending practices. The Treasury will continue its work with the FSA, mortgage lenders and intermediaries, and consumer groups, to ensure a mortgage market that is sustainable for all participants.