The FCA and regulated mortgage contracts
The Financial Conduct Authority (FCA) is the regulator for consumer mortgage lending. This includes how lenders deal with arrears and possession on regulated mortgage contracts.
A mortgage is a ‘regulated mortgage contract’ if it was taken out on or after 31 October 2004 and:
•the borrower is an individual – ie, they are acting as a consumer and not for business purposes;
•the loan is secured by a first mortgage on a property;
•the property is at least 40 per cent occupied (or is intended to be occupied) as a dwelling.1Art 61 The Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 No.544
Since 21 March 2016, secured loans which are not first mortgages are also regulated mortgage contracts if they meet the rest of the above criteria and:
•the loan was made before 21 March 2016 and was a regulated credit agreement when it was made and so covered by the Consumer Credit Act 1974; or
•the loan was made after 21 March 2016, but would have been a regulated agreement and covered by the Consumer Credit Act 1974 if it had been made before this date.