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Since the Mortgage Credit Directive, there has been some confusion around second charge mortgages

Iain Stephen

Joint CEO

Sector Focus: Mortgages

Claire Wilkinson

Since the "Mortgage Market Review" by the FCA in April 2014 and the implementation of the Mortgage Credit Directive, firms are under much more scrutiny from the Regulator. Our dedicated Mortgages Practice is led by Iain Stephen. Find out more about Iain CLICK HERE

March 2016 saw the implementation into the UK mortgage market of the Mortgage Credit Directive (MCD), which is based on European legislation. Under this Directive, the majority of second charge mortgages moved from Consumer Credit into mortgage regime. All mortgage firms need to understand the MCD implications for their particular business.

Our Services

Our approach is that compliance should be an enabler rather than a blocker to business, we always seek to assist clients to find a compliant way to achieve their aims.  Compliancy Services helps Asset Management firms with their:

  • Authorisation applications
  • On-going compliance management
  • Staff training

Mortgage Credit Directive (MCD)

The MCD had implications for lenders and intermediaries involved in buy-to-let activity. Specific conduct standards now apply to firms conducting broking, advisory or lending activity with a buy-to-let consumer, unless the buy-to-let is for business purposes.

Firms affected by this should have decided what type of business they're engaged in and, where appropriate, have registered with the FCA if they wish to continue with this after March 2016.

Second Charge Mortgages

Since the MCD, there has been some confusion around second charge mortgages. Some of our customers are finding that their activities fall under the MCD,  some consumer credit regulation, some both of these and some neither of them.

This then creates a potential risk for a firm as it becomes hard for them to ensure they meet the required regulations.


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