Byers pressed to call in small lenders to face summit

The department of trade and industry was last night racing to fix the date for a second summit of the major mortgage lenders in the few working days between Christmas and new year.

Stephen Byers, the secretary of state for trade and industry, had originally promised to call major lenders to task before Christmas to ask them for a detailed response to the issues raised at the first summit in October, which was billed as part of the government's plan to end practices which "ripped off" consumers.

The October meeting proved to be far more conciliatory than publicised, although the DTI did call on the industry to respond to its concerns about lock-in penalties on mortgages, endowment mortgages, practices by some mortgage lenders to sell their expensive home insurance and the way interest rates are calculated.

The DTI is likely to face pressure to widen the scope of the invitations to include the smaller, mutual building society lenders, which the Consumer Association has admitted fall prey to some of the worse practices in mortgage sales. The government is expected to conclude that mortgage lending should come under the remit of the financial services authority.