However mortgage brokers and lenders will see their funding requirement rise as the second charge regime is integrated into the existing regime.
Most categories will see a 1.6% fall in costs, but mortgages have an increased funding requirement of 8.7% leading to a net increase of 7.1%.
The FCA is estimating a 10% increase in firms’ declared income, so the amount a firm will pay will fall by 2.3% on a like-for-like basis. The AMI argues that "the mortgage industry does however keep paying for its success".
The Association pointed out that £3.1m has been added to the costs of mortgage lenders and brokers to supervise the second charge regime. The total bill for lenders and brokers now stands at £36.8m and AMI says it "still awaits a proper explanation on what is costing this much".
The AMI said that it will continue to challenge the "unfair fee increases" on behalf of member firms, ask for explanations as to what the money is being spent on, and campaign for "amendment to the unfair FSCS funding arrangements" that are not included in the FCA consultation.
Robert Sinclair, Chief Executive of AMI, said:
“When the £200 annual fee for holding the Consumer Buy-to-Let permission is added plus the hidden FOS levy, together with £300 minimum annual fee for Consumer Credit – this makes the new bill for the smallest firms look increasingly expensive. What was £1,000 only two years ago can now be a staggering £1,619 for the same business.
"The mortgage industry has been hit with significant increases over previous years to pay for MMR and the implementation of MCD. Now that these are complete there is no respite as firms continue to be dogged with higher fees. The Business Plan makes no special play on mortgages but the costs continue to grow. No dividend for the investment in new regulation and no explanation on how the 8% increase was calculated or justified to the FCA Board.”
