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Finance watchdog to review mortgage market

Last year, the Mortgage Market Review was launched to help crack down on irresponsible lending by making it harder to buy with a tiny deposit and also prevent borrowing vastly more than a customer’s income.

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The U.K.’s Financial Conduct Authority and Prudential Regulation Authority on Tuesday rolled out a package of rules focused on whistleblowing in the financial services industry, introducing several measures to encourage workers to raise concerns at banks, insurers and investment firms.

Britain’s financial watchdog said on Wednesday it has begun a review of the mortgage market to see if there are areas where competition may not be working well or could be improved.

“Competition can play a key role in ensuring that the sector works well, delivering consumer benefits through lower prices, better customer service and more product choice”.

“We are seeking stakeholders’ views on competition in the mortgage sector”, added Christopher.

Read the Call for Inputs on competition in the mortgage sector.

The FCA said it is looking for views about where competition issues may exist and need further investigation.

These rules are being put in place following an insurance add-ons market study undertaken by the FCA in March 2014, which established that a large amount of consumers were being sold additional products without being notified that they were optional.

Market studies are one of the main tools the FCA uses for examining how competition works and to assess whether it should intervene in the interests of consumers.

The Financial Conduct Authority said it can be challenging for people to compare a vast array of home loans on offer with no consistent terminology for fees and charges.

The FCA has an overarching strategic objective of ensuring the relevant markets function well.

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“There is also anecdotal evidence, subject to much media interest, that a few types of consumers are becoming unfairly trapped and unable to access more suitable deals”, the FCA said.

Director of Strategy & Competition at the FCA Chris Woolard commented as part of the announcement of the CFI