FSA warns over misinformation
Posted: 30 Jun 2006 16:27:11 GMT
A financial watchdog claims that many mortgage lenders and brokers are giving misleading information to customers regarding their home loans.
An investigation by the Financial Services Authority (FSA) has found that one in four Key Facts Illustrations (KFI) provided by small mortgage lenders as well as small to medium sized brokers have included errors regarding the charges and fees.
Among the mistakes were inconsistencies when detailing likely charges as well as failing to discuss early repayment fees.
In addition, over half of Initial Disclosure Documents, which detail the firm's services and likely fees for customers, were found to have five or more mistakes.
Clive Briault, the FSA's managing director of retail business, commented: "Providing consumers with clear and relevant information is a key element in consumer protection because it enables them to make informed decisions and to shop around.
"We will continue to press for these standards to be met, by following up shortcomings with individual firms and by working with the industry."
However, the FSA did say that overall, the quality of disclosure information had shown improvement over the past 12 months.