The Council of Mortgage Lenders (CML) had previously been extremely concerned that the FSA's earlier proposals would have had a disproportionate and detrimental effect on consumers in the mortgage market, as well as on lenders. The FSA has, however, listened to those concerns and has now refined a far more workable and appropriate set of measures. These will enable consumers to get mortgages suitable for their needs, within a regulatory approach which provides sensible safeguards.

While there are bound to be specific aspects of the consultation that will require a detailed industry response, the CML is pleased that the FSA has recognised both the principle and practical difficulties that would have arisen from the earlier proposed package of measures.

CML director general Paul Smee commented:

"Lending needs to be responsible and done in a way which protects consumers. Rules need to be practical and avoid unintended consequences. Whilst there is much detail to be pored over, the FSA's new proposals seem to strike broadly the right balance. If lenders are to make their contribution to improving the supply of housing and to the wider agenda for economic growth, then they need a regulatory framework which also supports that objective.

"We look forward to working with the regulator to iron out any remaining wrinkles and to move towards a smooth process for implementation. Ideally, this would take account of the European legislative proposals too, so that as far as possible the costs of regulatory duplication are avoided."