FCA ups mortgage adviser fees for 2019/20

FCA ups mortgage adviser fees for 2019/20

The Financial Conduct Authority (FCA) has proposed increasing the fees it will collect from home finance advice firms by £700,000 in 2019-20.

 

In its CP19/16 paper, the regulator is proposing a four per cent increase to £17.6m this year from £16.9m for firms in the A.18 Home finance providers, advisers and arrangers fee block.

It is also increasing fees collected from firms in the A.2 block of home finance providers and administrators by 4.1 per cent, up to £17.9m from £17.2m.

Advisers and lenders operating in the consumer buy-to-let market will see these fees increase by two per cent, with advisers in block G.21 paying £212 and lenders in block G.20 paying £424.

And the A.0 minimum fee which is payable by all firms operating within the A fee block has been increased by two per cent from £1,128 to £1,151.

 

Overall funding

Overall the FCA’s annual funding requirement for 2019-20 has increased by 2.7 per cent to £558.5m, which includes a two percent increase across its standard ongoing regulatory activities (ORA) budget to £537.7m.

The remainder is made up of scope change recovery, including consumer credit and claims management regulation, Brexit planning and securitisation regulation set-up costs.

The FCA said it was intending to keep the scope change costs within the fee blocks affected by the changes.

And it intends the £5m Brexit preparation bill to be covered by fee-blocks that include banks, insurers, fund managers, and proprietary traders as it believes these types of firms are most likely to be affected by EU withdrawal.

 

FOS increase

The Financial Ombudsman Service (FOS) has also asked to almost double its recovery to £44.5m and will allocate this in line with its forecast of where costs will fall.

The increase of £20m will allow the FOS to manage the set-up and year one costs of the two new jurisdictions: complaints made by small and medium-sized enterprises, costing £5m, and complaints made about claims management companies, costing £2.2m.

It will also allow it to scale up to meet increasing demand and a change in product mix, costing £11.3m, in expectation of a total of 210,000 new cases outside of Payment Protection Insurance (PPI) cases in 2019/20, the highest the service has ever received and approximately 30% higher than the 2018/19 budget assumption of 160,000 new cases.

 

SOURCE: mortgagesolutions

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