Securitisation and Regulation News

FSB Publishes Consultation on Residential Mortgage Underwriting Practices

The FSB launched a public consultation on its draft Principles for Sound Residential Mortgage Underwriting Practices that aims to set minimum acceptable underwriting standards. The FSB Principles are intended to apply to loans to individuals (consumers) that are secured by a residential property (e.g. mortgage). However, some or all of the Principles may not necessarily be appropriate or applicable for certain niche forms of finance. The FSB consultation covers the verification of income and other financial information; reasonable debt service coverage; loan-to-value ratios; and effective collateral management. The deadline for comment is 9 December, 2011 and a final set of principles will be released in early 2012.

FSB consultation