The ABCs of the MCD - how will the upcoming Mortgage Credit Directive affect you?

03 Sep 2015

From the 21st of March 2016, the Mortgage Credit Directive will remove the broking of Buy-to-Let properties from consumer credit regulation.

A non-FSMA regime for ‘Consumer Buy-to-Let’ mortgage intermediation, lending, administering and advising will also be introduced. BTL mortgage activities, other than broking, will fall outside of the scope of the consumer credit regime.  

CBTL is a subset of the BTL market which applies when a BTL customer is not acting wholly or predominantly for business purposes. For example, when a property is inherited but cannot immediately be sold, thus the decision is made to rent the property out.

CBTL will be regulated by the FCA. Although the legislation states that Business, or Commercial, Buy-to-Let will not be regulated, firms carrying out other regulated credit activities - such as debt counselling - will need to ensure they have the appropriate permissions and are authorised by the FCA under the consumer credit regime.

To read this article by Liz Coyle, Compliance Policy Manager of the SimplyBiz Group, in full, please click here


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