Industry bodies have sent a letter to the chancellor George Osborne warning him of the “dire consequences” of the FSA’s proposals to change mortgage regulation, the consultation for which closed on November 16. <br> <br> In the letter, HBF’s executive chairman Stewart Baseley wrote: “Lenders should of course be required to lend responsibly. But the onerous and overly prescriptive proposals will restrict access to home ownership and have far reaching implications.” <br> <br> Baseley pointed to independent research by Polis revealing that had the FSA’s proposals already been in place, of the current 11 million mortgage holders nearly half would not have been able to borrow what they did and up to a quarter may not have been able to borrow anything on any terms. <br> <br> Polis estimated that each year, the proposals would mean that up to 153,000 house purchases would not be possible and that 57,000 first time buyers would be refused mortgages. <br> <br> The organisations, including HBF, NHBC and the National Housing Federation, also said that the FSA needed to change its assumption that shared ownership lending was classed as sub-prime, or banks would continue to turn away more than £240 million of valid business. …