Mortgage Strategy launches campaign to bring down FSA fees

Published: 07/06/2012

Mortgage Strategy has launched its “Bring Down FSA Fees” campaign which calls for the Financial Services Authority (FSA) to reduce its annual fee to mortgage brokers.

The calls come after the FSA confirmed a 9.2 per cent rise in its 2012/13 budget forecast, an announcement that has seen it listed as “Villain of the Week” in this week’s Mortgage Strategy magazine.

The FSA has defended the increase, stating its income from brokers has dropped and therefore it requires brokers to pay a larger part of their income to cover the shortfall.

It has been estimated the increases will cost both small and larger firms alike:

Firm Mortgage income Insurance income 2005/06 fees 2012/13 fees
Small firm £50,000 £30,000 £870.44 £1,854.77
Large firm
<£2m £1m £14,653 £51,588^

Understandably these significant increases have been met with severe criticism from mortgage brokers and financial advisers, especially given the current market activity.

Pat Bunton is the Director at London & Country:

“We, along with every other firm, has had a tough few years and seen the market contract from £360bn to £140bn. To get close to a double digit increase in fees against a backdrop of a market size that is a third of where it was is uncomfortable.

“Most firms operating in the market have seen their income fall and have had to watch costs very tightly. It would appear the FSA is in a much more privileged position and can set its own budget and that seems to be an ever increasing budget.”^

^Mortgage Strategy (June 2012)

Content correct at time of publication

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